5 Ways to Turn Potential into Profit

by Franne McNeal
 

Even if you were paid big bucks as a talented employee, it may be tough to transition and triumph as an entrepreneur. Here are five considerations to help you focus your efforts. Just because you have great business ideas, it doesn't mean that your ideas will get you income and profits.

  1. Mindset Matters.
    Interview and research entrepreneurs (start-up, year 3-5-10) in the business area and industry that you want to pursue. Identify the entrepreneurial characteristics (critical, needed and optional). Are you ready to be a business owner?
  2. Paychecks vs. Payments
    Employees generally "take direction." Entrepreneurs generally "set direction" via influence and service. As an employee you create a resume that says "what you did." You provided services, and you got a regular paycheck.

    As an entrepreneur, you create products and services that identify "what we can do for you" (solve a problem or meet a need). You get "paid" when a customer or client wants what you have (which may or may not result in predictable and/or steady payments).

  3. Roles and Risks
    As an employee you have annual reviews, and complete performance plans based on the needs of the organization. As an employee, you have a defined scope of responsibilities, and may be penalized if you "step outside of the box."

    As an entrepreneur, you evaluate risks and constraints as part of the "box" that helps you define, protect and strengthen your competitive advantage within your industry, regional and local marketplace. Get "rich in a niche," establish a unique selling position and/or brand, and know your competition and trends.

  4. Think C-Suite (CEO, CFO, CIO, CMO, COO, CXO)
    As an entrepreneur, you perceive and conceive the needs of the organization though leadership and teamwork.
    • Establish your organization's vision, mission, strategic goals, systems, culture, and clients
    • Create tangible and intangible systems so your business can identify problems, potential and profit
    • Leverage the talents of professional advisors, strategic partners, executive team, employees, stakeholders
    • Utilize performance reviews in all aspects of the business (finance, human resources, operations, etc).
  5. Measurement Matters
    Cash may be king, but collateral is queen! Every resource (time, talent, tangible, or intangible), should be budgeted and checked against "actual," every month, quarter and year. As an entrepreneur, you set the financial foundation (goals), attract the funders (roles, relationships), and plan the future (results). ROI, return on investment, should include qualitative and quantitative metrics.

Action Steps

Email responses (150 words or less) to Franne

  1. Based on your experience as an employee...
    List 1 specific situation where you "set direction," and it influenced your organization's competitive advantage, increased revenues, decreased expenses, lowered the break-even point, changed the gross margin, and/or improved profit. Provide numbers and/or metrics to "prove" your point.
  2. Based on your desire to be an entrepreneur...
    Use your customer's or client's "own words" to identify what problem you solve or need you meet (for them), and how they benefit from your "solution."

 

Franne McNeal, CEO, www.hrenergy.com
P.O. Box 807
Bryn Mawr, PA 19010
215-552-8719
coach@hrenergy.com