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Business Survival

Are You Building Your Business Like a Political Party?

Our recent election offers interesting insights into building your own business.

Pavlo Phitidis




Reflecting back on the 2014 national election got me thinking about the similarities between building a business and building a political party in South Africa.

The performance of the parties, most of which were in all their communications, their manifestos, their behaviour, demonstrated many similarities to the world of entrepreneurship and business development that I see every day.

Related: 7 Leadership Lies You Probably Believe

The Business Lifecycle

I’ve spoken often about the business development lifecycle. All entrepreneurs traverse this lifecycle as they endeavour to grow their businesses. All businesses start, enter into the early stage of development, hopefully move into growth, then the prime of their lifecycle, followed by maturity and eventually decline.

In each of these stages the activities, focus and tactics, to get to the next stage, need to be considered. What worked in the past is not a guarantee of what will work in the future.

Besides the fact that each stage of the business development lifecycle poses different challenges for you as the business owner, the technical requirements to get to that next level differ from those that worked so well before.

By the way, this is what ‘next level’ truly means. We hear the words being bandied about in adverts, conferences, and the media and so on, but have you ever considered what they really mean?

In reflecting back on this election, the behaviour of the political parties represented by the ANC as an established business with a big brand, the DA as a medium-sized business, and the EFF and AGANG as the start-ups, makes for an interesting reflection on how you might be building your own business.

Related: Give Your Ideas a Fighting Chance With These 5 Actions

The Idea Graveyard

The two most vital requirements of a successful start-up are an idea whose time has come, and a driven, capable start-up team. As a start-up entrepreneur, your idea is never enough. Many entrepreneurs I meet have ideas that can change the world and perhaps will one day.

Yet, most of these ideas find the ‘If only’ graveyard where they R.I.P.  An idea needs to be directed at someone, and finding that someone in the start-up phase of development is the single hardest action that you need to overcome.

If you try be all things to all people by promoting the features of your product or service to all and sundry, the likelihood of success is low.

You might find some traction but languishing in the start-up phase of your business’s development is the most likely outcome. This happens often to most ideas that are intellectually driven, that have big business plans behind them and that were born by bright, smart entrepreneurs who can intellectualise blood from a stone!

It’s also very typical of first-time entrepreneurs.

Speaking to the masses

If you start your business based on insights you get from the ground – the coal face of being in a group of people who are similar and have similar needs and wants – the idea of the start-up is often not yours.

It is often born from the fragments of insight, the bits and pieces of conversations within this group of customers that you can aggregate into an idea and who, with every iteration, becomes more cogent, relevant and real. The probability of your idea being a business idea is increased if you have spoken to many, similar people and not just your family or friends.

The probability of launching a new business with a fresh, new idea is also better suited to a customer grouping that is either young or ready for change and not contaminated by their views on the past.

It was Carl Jung who offered this famous insight: “We are trapped by the images of our past.” Launching new ideas and businesses to an older customer segment can be done but needs big marketing money behind it!

Related: Turn Your Company into a Money Machine

Failure is the road to success

Previously failed entrepreneurs who see failure as a teacher and not an undertaker are bound to succeed eventually. If failure is simply a path to success, that it was the wrong path and illuminates another path that may work, is a mind-set that serves success.

In addition, entrepreneurs who try to start businesses on the back of deal-making alone without having built an asset stack – an expression I use to measure your value coming into a deal – often don’t make it to the next round. Your start-up team needs the right attitude, heart and credentials. Excellent, symbolic brand imagery also helps.

Given the economic concentration that South Africa has unfortunately inherited from its past, medium-sized businesses entering into their growth phase need tremendous patience in a slow economy.

It takes time for big established businesses to stumble, fall and create the space for these medium-sized businesses to grow into. But here’s the thing: You cannot afford to be a medium-sized growth business for too long since you too will eventually get trapped by the images of your past and the path to growing to the next level becomes harder to see with time. Leadership becomes fatigued, shortcuts get taken and strategy can be supplanted by expediency that compromises or confuses your brand values.

As a business owner in the growth phase and wanting to get to the next level – the prime phase of your businesses development – decide on what war you are fighting in your market.

Be the Tortoise, Not the Hare

Don’t be tempted to fight all the battles against your competitors who are often bigger than you. Entering the next stage of your business lifecycle needs patience, consistency and commitment to your stated goals and strategic imperatives.

If your value proposition is service delivery, the real war is local government elections and not the national election!

Right now at Aurik we are working with a number of businesses that are in their second generation, selling the products of a big, famous and well established brand and generating over R500 million annually. Their biggest asset, a famous, powerful brand has proven to be one of their biggest weaknesses.

A big brand is not enough to sustain a market leadership position. Simply relying on your established brand equity does not help you grow your business to the next level. There is another problem in this environment that time delivers – the treacle of bureaucracy that governs everyday life and activity.

These features are the exacting features that accelerate your progression to the next level of the business development lifecycle – decline!

In the medical insurance industry, would Discovery ever have existed if the big brands of the time had not suffered from these features? Would the inroads made by the small and medium-sized political parties have been made if the ANC were not hamstrung by similar challenges?

Business Decline? Re-invest!

As a business owner, if you are in this phase of your lifecycle, reinvent fast and if you can’t do it, get some help in fast. Your being unable to do it has little to do with not being bright enough, smart enough, clever enough, and whatever else goes on in the silent recesses of your mind. Rather this happens because of the loneliness we all experience as business owners.

It is further compounded by depleted energy and a team that is too comfortable within your ranks, one in which group-think governs the views and decisions taken in the business. The biggest failure of group thinking is that you often believe your own propaganda, a fatal flaw in any business!

So, as we look to our next national election five years from now, I look forward to the business models, leadership teams and promotional tactics that will govern the local government elections two years from now.

How the start-ups grow and how the mature parties respond to them, in my view, will make the most significant elections in our young country very exciting. Never let it be said that lessons and insights into political party strategy cannot be applied valuably to our own businesses.

Who would have thought?

There’s more to be learnt from political parties than you might realise, especially when it comes to winning or losing loyalty.

The South African political landscape is representative of business lifecycles with energetic start-ups, fatigued medium-sized businesses and mature organisations bogged down in bureaucracy.

Related: How to Outwit Your Competition

Pavlo Phitidis is the CEO of Aurik Business Incubator, an organisation that works with entrepreneurs to build their businesses into valuable assets. Pavlo is a regular commentator on entrepreneurship on 702 Talk Radio and 567 Cape Talk Radio. He can be contacted at


Business Survival

How To Embrace An Exponential Mindset For Your Business

In the age of exponential technologies, it’s a risk not to take a risk.

Mic Mann




Think global and exponential

If you’re an entrepreneur trying to establish a successful business, it’ll be dead before it even takes off, if you don’t build it for the future. You have to think three to five years ahead, so when it launches, it’s still relevant.

Think like former Canadian pro ice hockey player Wayne Gretzky, who said: “I skate to where the puck is going to be, not where it has been.” And these days it’s easier for entrepreneurs to predict the future thanks to technology and data insights.

Consider what Singularity University co-founder Ray Kurzweil calls The Law of Accelerating Returns. He says the only thing that’s constant is change and that change itself is accelerating exponentially. As per Moore’s Law, information-enabled industries are doubling their performance and halving their price every 18 months, according to the price-performance ratio. The field of biotechnology has managed to surpass that.

Related: 5 Mindset Changes You Must Make When Going From Employee To Entrepreneur

There’s no time to slow down, your business has to constantly evolve, and you have to keep asking “what’s next”. Encourage experimentation and innovation in your company. Innovation focuses on incrementally improving your already existing products and services, while experimentation allows for fresh outlooks and breakthrough strategies that leapfrog old ways.

We should reprogramme our linear mindset into an exponential one. Don’t aim to grow your business by 10 per cent year-on-year, but rather 10 times. The first thing I learned at Singularity University is the potential of exponential growth. If you take 30 linear steps, you only move 30 places, but if you move 30 exponential steps your place doubles with each step and by the 30th step, you’ve moved over a billion places.

We’ve seen this happen with unicorns – not the magical creatures, but start-up companies that are valued at over $1 billion within their first year – like Slack (cloud-based team collaboration tools and services) and Square Inc. (a mobile payment company). It once took around 20 years for American companies to reach the billion-dollar valuation mark, now it may take less than a year.

In the early stages – until your third step – your progress may seem linear. Many exponentially-geared companies give up at this point – just as their growth rate is about to explode. Persevere!

A few decades ago it was unthinkable for an individual or start-up to disrupt entire industries. Start thinking globally, not locally. Use staff-on-demand and crowd souring to propel your business ahead of the competition. It’s unlikely that you have the world’s smartest minds working for you, however with the power of the crowd, you just might.

If you’re struggling to find a solution, turn the challenge into a game and offer prize money. You’ll have thousands of people attempting to solve your problem, but will only pay for the best solution. Kaggle is a platform for predictive modelling and analytics competitions. It lets statisticians and data miners compete to produce the best models for predicting and describing data. Mining company Gold Corp placed its geological data online and offered money to anyone who could locate gold at their Canadian mine. Four of the five winning entries struck gold. And in 2011 it took a team of gamers 10 days to solve an enzyme riddle that could hold the key to curing AIDS.

The six Ds of tech

As companies become information-enabled they should internalise what Singularity University co-founder Peter Diamandis calls the six-step growth cycle of digital technologies. These Six Ds of Tech Disruption are digitisation, deception, disruption, demonetisation, dematerialisation, and democratisation.

The first step is digitisation. Once something enters the digital realm it gains the potential for exponential growth. Think of the radio and CDs. You no longer need either, instead you can stream online, listen via YouTube or download music. After digitisation, growth appears slow, even deceptive. Sadly that’s when many companies opt out. Be patient!

Related: How To Build The Right Mindset For Start-up Success

No one imagined Kodak would disappear after a century. Kodak thought they were in the business of printing photographs, while they were in the business of memories. Think about the need your business solves. Kodak invented the digital camera, but was too scared to disrupt its own industry. It didn’t realise that people were no longer taking photographs in the same way, so their competitors disrupted the industry instead.

Today, the camera has become part of the smartphone and photographs are predominantly shared via social media. Instagram epitomises the next step in the equation: demonetisation. With time technology becomes cheaper and even free. Instead of printing photographs, many people instantly share them on a free smartphone app like Instagram.

Next comes dematerialisation. The radio, camera, video recorder, GPS, calculator and calendar are disappearing from the physical world as they’re being built into the smartphone. The wallet will dematerialise next with the advent of online transactions and cryptocurrencies.

Finally, democratisation happens when government, corporates and the wealthy no longer hold control and masses of people have access. Just think, the average South African with a smartphone has access to much more information than the president of the United States of America had 20 years ago.

In the age of exponential technologies, it’s a risk not to take a risk.

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Business Survival

Why, When You Fail, You Should ‘Fail Forward’

So, you’ve fallen on your face? Consider that you’re walking in the footsteps of some ‘famous failures,’ like Steve Jobs, Oprah Winfrey and Stephen King.



Arianna Huffington

5 Inspiring stories to keep in mind

1000 times he failed

Teachers described him as “too stupid to learn anything.” He got fired from two jobs because he was “non-productive.”

Then he tried inventing something completely new. What’s even crazier is that he tried 1 000 times, unsuccessfully. When a reporter asked him how it felt to fail 1 000 times, the story goes, he replied, “I didn’t fail 1 000 times. “[The invention] was an invention with 1 000 steps.”

Through pure determination, Thomas Edison – initially a failure – made the world a brighter place to live in. If such good things come from success, then why do we choose to always look at the brighter days and completely disown the tough times?

Here are five more inspiring stories to keep in mind, should you ever feel that you’re the biggest failure.

The woman whose book got rejected 36 times

Arianna Huffington

Arianna Huffington

You’d think that once one book you’ve written becomes a bestseller, publishing another one would be a walk in the park. But it’s not that easy. At least not for Arianna Huffington.

Having produced that first bestseller, The Female Woman, when she was only 23,, Huffington tried to pitch her second book, but none of the 36 publishers she approached said yes. Still, she didn’t give up.

And that’s just one of a couple of failures from The Huffington Post’s co-founder. She has been dropped from hosting a BBC show, garnered 0.55 percent of the vote (when she ran for governor of California) and been unsuccessful when she called for then-President Bill Clinton’s resignation through her website.

But now The Huffington Post gets millions of visitors every month; she’s had a successful book career; and, if it helps, she’s very rich. Clearly, “failure is a stepping stone to success.”

Related: How Failing Fast was Nomanini’s Ticket to Creative Innovation

The woman who was “unfit for television”

Oprah Winfrey

Oprah Winfrey

Oprah Winfrey is worth more than $3 billion. But it hasn’t always been like that. And, considering that a Baltimore TV producer called her “unfit for television” right before he fired her, it’s telling that the main source of Oprah’s success was a TV show that ran for more than 20 seasons.

Oprah also tried to get into the movie business with the movie Beloved. It lost to Bride of Chucky in terms of revenue and consequently lost the $80 million invested in it. Oprah has said this failure sent her into a state of depression.

But then, in 2013, she got back onto the horse (speaking cinematically) with The Butler.

See? Even when you make it, you’re still at risk of failure. Henry Ford, William Crapo Durant and Walt Disney (among so many others) all went bankrupt after they’d already made it big. But each one sprang back in his own way.

The man who was fired from the company he’d founded

Steve Jobs

Steve Jobs

Not all of Apple’s products have received mass acclaim. More specifically, not all of the Apple products launched by Steve Jobs have been successful.

One such failuret was the Lisa computer. This was supposed to be a desktop computer targeted at personal business users. For a purchase price of $10,000 (about $24,000 today) consumers could buy the first desktop that would allow them to use a mouse to work with a 5MHz processor and up to 1MB RAM. The Lisa sounded like a magnificent idea, at least at the time.

However, the pricey computer sold poorly, and then-CEO John Scully, someone Jobs had chosen for that position a few years earlier (there are so many lessons in this story), helped remove Jobs from the Macintosh division in 1985.

So Jobs left Apple. Then he founded NeXT, and failed again, but sold the software division of NeXT to Apple in 1997. Then he returned and became CEO in 2000, and this time he was determined to make Apple something special. He succeeded.

Related: Why Balls to the Walls Could Mean Failing Fast

The man who almost gave up after 30 rejections

Stephen King

Stephen King

Stephen King was just selling short stories and teaching English when he had the idea to write Carrie. However, despite the $2,500 advance he received for the novel, he decided to give up on the book after 30 rejections.

But his wife wasn’t going to let him do that. She urged him on, and he finally agreed to submit the manuscript again.

Carrie is one of King’s bestsellers and went on to become two film adaptations, one of which won the lead actress Sissy Spacek an Oscar.

The man who quit – just before striking gold


Talk about hitting a gold mine

One last story comes from Napoleon Hill’s book, Think and Grow Rich. In it, the author writes of an interview with a millionaire named R.U. Darby who in turn described an uncle of his who, having heard of the riches that came from finding gold, set out to do just that. After weeks of commitment, this miner finally spotted a vein of shining ore. He raised the money for the necessary machinery and went ahead and he started shipping the gold. However, before long, he’d lost the vein of the gold ore.

Related: How Tebogo Ditshego Transformed a Failing Business and Tripled his Revenue

He tried to find it again and was unsuccessful. Then his workers quit and sold the machinery to a junk man. The junk man called in an engineer to inspect why the project had failed, and it was determined that the vein was just 3 feet (three) away from where the Darbys had left off.

The lesson? Before you stop trying, try again. If not for yourself, then for other people. What would the world be like without Thomas Edison’s invention? How about Alexander Graham Bell? Use failure as a step to elevate you because it’s by learning to accept failure that we can see great success.

This article was originally posted here on

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Business Survival

How To Recession-Proof Your Business

South Africa is in a technical recession. Here’s how to navigate the turbulent times ahead.




For the lay-man like myself, it’s important to understand that a technical recession is an economic term that describes two consecutive quarters of negative growth in an economy. For South Africa, gross domestic product (GDP) declined 0,7% during the first quarter of 2017 after contracting by 0,3% in the fourth quarter of 2016.

Why is this a big deal? Because the economic outlook, even without the technical recession, was bleak. Ratings agencies are losing confidence in South Africa. S&P downgraded the country to junk status earlier this year, followed by Moodys, which revised South Africa down a notch.

Related: Can Your Business Survive A Recession?

How organisations respond to recessions

There are a number of knee-jerk reactions to a recession as a direct result of decreasing revenues and profits. The most relevant to SMEs are:

  • Cutting R&D spending. This means no new product lines, and no incremental innovation expenditure unless it returns direct value to the business.
  • People get fired. In a time where underperformance has a double impact on the business, people that aren’t performing are performance-managed out the door.
  • Market shares shrink. This is often due to reduced R&D spends.
  • Processes are evaluated. Companies start looking for efficiencies that should have already been in place.

Outlook and opportunities for SMEs

For SMEs, sales and product planning in a recession is key and must align to the way big business is responding to the recession.

Fundraising for capital expenditure is more expensive, but not impossible. It may be valuable to invest ahead of the curve to capture the emergent big businesses during this period and therefore external investment may make sense.

In an increasingly collaborative economy, SMEs should look to each other for partnerships and complementary projects that cost little to assemble, but amount to great value for a big business.

Survival of the nimblest

Cut down

SMEs have the ability to be nimble and move quickly to change organisational structures and deliver on just-in-time value. This can be hamstrung by unpredictable fluctuating expenses like cell phone contracts that may vary in cost in an unpredictable way from month to month. The fewer of these costs on your books, the better.

Related: How Renay & Russell Tandy Have Survived 2 Recessions And Built A Successful Agency

Sell harder

The term ‘always be closing’ is a famous sales mantra, it’s also applicable in a recessionary context. First, because you don’t know what they don’t know and unless you tell them — who will? Second, the feedback loop of understanding the concerns and actions from your customer or client can only be understood through interaction.

Position smarter

Is it clear that you are the best provider for the job that needs to be done? If not, it is important to build a stakeholder strategy that puts your business in front of the key procurement and strategy custodians. This may be a great opportunity to exhibit demos, case studies and showcase the efficiency that you offer.

Focus on value

I can’t over-state this. Value, value, value. It goes without saying that one of the key reasons anyone would consider an alternative supplier is because of the specific problem they solve, so this should be your approach in reinforcing the value you bring to the table. Repetition builds memory structure.

One recession doesn’t fit all

It’s important to understand that for SMEs a recession can have an expansionary effect in the same way the lipstick effect applies to luxury goods and services.

The lipstick effect is the theory that when facing an economic crisis, consumers will be more willing to buy less costly luxury goods. Instead of buying expensive fur coats, for example, people will buy expensive lipstick.

A series of psychology experiments have confirmed for the first time that while tougher economic times decrease desire for most items, they also reliably increase women’s yearning for products that boost their attractiveness.

Parting shot

So, for SMEs, the formula is simple — don’t panic, analyse your customer value chain and position your solution accordingly and then sell, sell, sell.

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