Previously we looked at being pro-active about the things we can change.One of those things is the way we handle our own money. So I have asked C&A International [one of the leading offshore investment advisors in SA] to develop a brief email course to teach us about investing offshore. When you consider that most of us have money invested in local insurance policies - earning under 10% - which could have earned more than double that offshore over the past few years - you will understand why this little bit of knowledge can be really useful. Just because I want to stay in this country doesn't mean that I shouldn't take advantage of the declining Rand! This course looks at how to do it, where to put it, when to do it, what it is, etc. And it's real light on the promotional stuff. Click here to enrol on this free email course.

This week...
Having your own business is almost identical to being the captain of your own ship. If you analyse the reason for most shipwrecks – you will find a few common themes. Firstly, the captain wasn’t at his post at the time of disaster. Secondly, the captain was incompetent. And thirdly, it was one heck of a storm – so overwhelming that no amount of skill would have saved the ship.

And what’s this got to do with business, I hear you ask? Simple really – you are the captain of your own ship. Yet as many as 96% of business ships strike the rocks in their first 10 years. Why?

Firstly, the captain [you] wasn’t at his post at the time of disaster. The captain’s place is on the bridge where he can see into the distance. His role is to steer the ship safely from point A to point B. Although he carries responsibility for every facet of ship life – from the engines to the food – he doesn’t do it himself. Because if he did all of that [very necessary] stuff himself he wouldn’t have time to be on the bridge – which is where a captain belongs.

And while you’re on the bridge you’re checking the weather. Not only do you look outside through the windows, but you also monitor the weather radio and TV channels, as well as the Internet – so that you can anticipate what’s coming up. As each parameter changes, you simply make decisions to make the best of each circumstance. But if you’re in the engine room, up to your elbows in oil and spare parts, you’ll be too busy to anticipate any of this. That’s why ships have engineers – so that the captain can steer. In order to guide the ship adequately he needs time to consider and reflect and monitor.

One of the major reasons for business failure that I see is that so many of us spend our time messing about in the engine room instead of on the bridge. And as long as you’re up to your armpits if engine grease you’re not looking out of the window. And as long as you’re not looking out of the window you can’t be steering the ship – which is why those rocks always come as such a surprise. While many captains can do the engineers job better than the engineer – they leave it to the engineer to do it. Yet many of us captains of the SME underworld still try and do everything ourselves. So the engines are running ever so sweetly as they drive the ship ever faster towards the cliffs

For most of us it’s inconceivable that someone else can do a better job than we can – so we avoid calling for help. Even a captain calls for specialist help. Each time he nears harbour he uses the specialist pilot tug to guide his ship to it’s berth – because that pilot is an expert on the local waters and sand bars. Yet we business owners don’t even do that – even when specialist help is clearly needed.

As a simple example, when you receive a summons – no matter who it’s from or why and no matter how big it is – you should always call your attorney for help. If you don’t have an attorney you can trust – then spend some time finding one – because sooner of later you’re going to need good commercial advice – summons, debt collection, sale or purchase of your business. At this point the pittance you invest in his/her services will be meaningless compared to the money you would otherwise waste on school fees. R20,000 of quality advice early in 1992 would have saved me almost 8 years and R2 million.

Secondly, the captain was incompetent. What would happen if the ship’s cook was suddenly promoted to captainship? Or the engineer? Although they know a lot about their respective areas, they know little about navigation; and even less about managing the crew.

Yet that’s the way most of us SME captains get our ships. We have a core skill that we can sell – but no navigation and management skills. Not only that – we don’t even plot a course before we start. Most of us do very little business planning [plotting that course]. Is it any wonder that we steer the ship into awfully unsafe territory.

Way back when – before all the modern GPS systems and decent maps – captains would literally sail by hunch. They had no idea of exactly what the coastline looked like as they explored new areas. [A bit like us as we start our businesses.] They relied on hearsay – much of which was ludicrous. They believed in mermaids, sea witches, and all sorts of myths inherited from other sailors. Isn’t that a bit like the way we inherit our business knowledge? Let me quote a few current business myths – “The Receiver is about to change the law regarding trusts.” “The law says you can only have one business cheque account.”

Don’t get me wrong. I am not saying that we’re incompetent in every field. I am saying that most of us lack certain essential SME skills. Before being given his own ship the captain spends a few years studying all the subjects he needs to successfully control a ship, followed by a few years of experience. Yet we SME folk blithely build a tiny boat and venture out into desperately treacherous waters without any business skills.

Thirdly, it can be awfully stormy out in the cold sea of business. Lots of sharks and unexpected terrors. And sometimes the storm is so big that even the most accomplished captain will lose his ship. But, if he’s prudent he will have a few lifeboats on board. [In fact, by almost every maritime law he has to have adequate lifeboats.]. Yet we captains of small industry venture out in unseaworthy craft, no lifeboats, and then we persist in messing with the engines! Wow – what a recipe for success?

Imagine what you would do if you were suddenly appointed the captain of a large oil tanker, tasked with transporting the cargo from Cape Town to Amsterdam. You have no navigation skills, have no engineering skills, and your only maritime efforts thus far have been on the tourist ferry between Cape Town and Robben Island. Probably the first thing you would do is locate a few folk with appropriate skills to help you – engineers, sailors, radio operator.

Chances are you wouldn’t rush out to hire a school leaving young lady to answer the radio – simply because she is cheap. Yet that’s what we business owners usually do. We don’t hire the skills we need – we simply hire bodies and then get frustrated when they can’t do the tasks we want done. In my simple mind that’s exactly the same as the task you face as a business owner. You have been appointed the captain of your own ship and tasked with transporting your current fortune [family, money and equanimity] safely. Not only that, but you’ve been entrusted to grow that fortune so that when you retire as captain you will have enough left over to look after yourself. The beauty about business, versus shipping, is that you can hire skills when you need them only – not for the full journey. Just like the pilot tug. Yet why is it that when we see the need for specialist skills we simply try and go it alone?

Most small businesses are just like ships – same challenges. The critical difference is that most of us small business owners spend our lives in the bowels of the ship tinkering with the engines; cooking the food; cleaning the cabins – in fact everything we possibly can – just so that we don’t have to go up to the bridge. Which is maybe why so many business ships run aground – even when there aren’t any storms!

Of course, with a ship, if something does go slightly wrong you can always stop awhile and simply float around while you’re thinking about what to do. But, now lets get that image into the 21st century. Imagine, for a second, that you are the captain of a Boeing 747…

© Peter Carruthers, www.petesweekly.co.za

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