Habit– Power of the Unconscious… Grow Your Business by Changing Habit: Habit Drives 95% of Customer Behavior…

Habit is the most influential governing factor of our everyday business and personal existence. Your actions, your responses, the decisions you make, the way you live your life are all largely dictated by habits…

A habit is a behavior or set of behaviors that you do automatically without thinking– and they are learned not instinctive; these are human behaviors that occur automatically without explicit contemporaneous intention of the person…

According to John Dryden; a habit is something that you create by repeating a particular behavior… Do something over and over and it will become habit, and attitude is an habitual way of thinking… Many a hapless business has been broken by habits and attitudes of its management– we first make our habits and then our habits make us… According to Jim Ryun; motivation gets you started, habit keeps you going

According to Neale Martin; habit begins with a revolutionary premise– 95% of human behavior is under control of their unconscious mind… this exposes a central flaw in traditional marketing theory, market research, and preponderance of business strategy, i.e., that customers are consciously aware of what they’re doing… Habit explains why 80% of new products fail and why billions of advertising dollars are wasted every year and why even satisfied customers aren’t loyal… marketing is focused on the wrong things…

According to Charles Duhigg; 40% to 45% of what management does every day may seem like they are making decisions, but they are actually habits… Good managers know-understand importance of habits… Bad managers just pretend that they don’t exist, and so when they emerge they end up being disruptive…

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In the article How Habits Effect Business by Taylor Ellwood writes: Habits are a part of life and business and when you know how their effect then you can start changing bad ones into good ones… thus creating a positive impact on your life and business. When we indulge in bad habits they are distraction and hurt the overall quality of your life and the business, even if they seem to provide an illusion of improvement… They affect the business because you are engaged in automatic behaviors that can have a negative impact… The reward is the reinforcement, for example; you habitually check ‘social media’ throughout the day, and the perceived reward is feeling connected to other people.

However, the real reason you are checking ‘social media’ could be because you are bored, overwhelmed… with the business work. Although this activity might not seem harmful, it’s most likely a distraction from your business activities… So until you recognize root cause of questionable behavior you won’t be able to change it– but once you do recognize it, then you can substitute a different behavior (habit) that provides the same reward, i.e., connection with other people… For example; instead of ‘social media’ you can directly contact customers, networking partners… Which gives same reward, i.e., connections, but more important it will actually help business… Take a few minutes to identify your habits– try sorting the good and questionable…

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In the article Grow Business by Changing Habits by Ndubuisi Ekekwe writes: An organization’s culture is amalgam of habits and depending on the dominant ones companies will either fail or succeed. According to biologists; the brain’s cerebral cortex is the data processor upon which our habits are wired. Hence the understanding of the electro-chemistry and relationship of the cortex with human behavior opens opportunities for companies to target customers effectively: That is, if companies can make us create habits that involve their products, they’ll be successful. But they may not need to create a new habit; they can simply infuse their products into our existing routines…

Take Facebook and Twitter, for example; they’re designed not just to nurture social habits of connecting with others, but also to create a new habit of hyper-expression. According to research at University of Chicago; texting and checking Twitter and Facebook come in just below sex and sleep on impossible-to-resist urges. Many of the social media companies can succeed provided that they maintain the elements that sustain habits…

Habits change and companies must keep pace with these behavioral changes; over time, some habits are dropped and new ones adopted… To be successful, companies must play a role in creating or disrupting people’s habits, and aligning them with their own products… The future is about habits and companies can only succeed if their products are central to maintaining them… Companies cannot just focus on existing needs and expectations of customers; they must anticipate desires– things customers don’t even know they need until they see them…

The process of reshaping consumer behavior doesn’t necessarily have to be disruptive, for example; B2B companies that focus on enterprise solutions must create new habits by realigning behavior by innovation. Companies that innovate and change behavior, making their own product an essential element of the new behavior are the ones that will grow and succeed…

In the article Hacking Habits: How To Make New Behaviors by Jocelyn K. Glei writes: In the workplace and in life we are little more than the sum of our habits. Who we are and what we accomplish depends largely on a vast network of routines and behaviors that we carry out with little to no thoughts… According to David Eagleman; human brain is in the business of gathering information and steering behavior…

Habits are the brain’s own internal productivity drivers and they are constantly striving for more efficiency. The brain quickly transforms as many tasks and behaviors as possible into habits, thus freeing up more brain power to tackle new challenges. In general this modus-operandi of our minds leads to incredible benefits but on occasion it seems nearly impossible to change our behavior…

According to Duhigg; habits consist of a simple but extremely powerful three-step loop: First there is ‘cue’, trigger that tells your brain to go into automatic mode and which habit to use. Then there is ‘routine’, which can be physical or mental or emotional. Finally, there is ‘reward’, which helps your brain figure out if this particular loop is worth remembering… Over time this loop… becomes more and more automatic and the ‘cue’ and ‘reward’ become intertwined until a powerful sense of anticipation and craving emerges…

The first rule of habitual changing is that you must play by rules; there’s no escaping the three-step loop (i.e., cue, routine, reward) because it’s hard-wired in our brains… However there is a final key ingredient; ‘belief’ that change is possible and this ‘belief’ is the ingredient that makes a reworked habit loop into permanent behavior…

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Habits are a funny thing: We reach for them mindlessly, setting our brains on auto-pilot and relaxing into the unconscious comfort of familiar routine. According to William Wordsworth; Not choice, but habit rules the unreflecting herd… In the ever-changing 21st century even the word ‘habit’ carries a negative connotation. So it seems antithetical to talk about habits in the same context as creativity and innovation. But brain researchers have discovered that when we consciously develop new habits we create parallel synaptic paths and even entirely new brain cells that can jump our thoughts onto new, innovative tracks. 

Rather than dismissing ourselves as unchangeable creatures of habit we can instead direct our own change by consciously developing new habits. In fact, the more new things we try– the more we step outside our comfort zone– the more inherently creative we become, both in the workplace and in our personal lives… According to Antoine Ezell; as marketers, our goal is to figure out the true ‘why’s’ behind our customers’ behaviors, much of which is tucked securely away in their unconscious– their habitual mind. This understanding allows us to create great customer experiences, which will have an impact on their behavior: This is the ultimate imperative…

According to Rose Hill; all habits consist of knowledge combined with skill from practice. What all this means is that you can learn new habits to replace those that are no longer working for you. And to learn new habits you must change what you’re doing, how you’re doing it, and the choices you make: If you keep doing what you’ve always done, you’ll keep getting what you’ve always gotten… That means that if your business is not headed in the direction you must make new choices and start new habits to ensure you ultimately get the results you want: Your choices of habits, determine your success… Up to 90% of your current behavior is based on habits…

According to  Dawna Markova; first thing needed for innovation is a fascination with ‘wonder’. A good innovation thinker is exploring other possibilities and this is where developing new habits comes in. You cannot have innovation unless you are willing and able to move past your habits and go through unknown– from curiosity to ‘wonder’.  According to John M Reisinger; most people never examine their habits when they’re trying to resolve conflicts… Our habits tend to manage-steer us as if on automatic pilot– just reacting to whatever turbulence we encounter…

 

Invading Personal Space, Boundary, Privacy– Workplace, Social, Home– Get Out of My Face: How Close is too Close?

Personal space is an imaginary area-space-boundary surrounding a person physical body (e.g., visualize transparent bubble surrounding your body)… It’s an invisible shield that most all individual form around themselves as an area of self privacy and protection… psychologically, possibly subconsciously, they regard this space as ‘their turf’– not to be violated… 

If an intruder enters their space without permission it makes them feel very uncomfortable or they may even react in some negative way… Have you heard of someone refer to their need for– personal space? Have you ever felt uncomfortable when someone stands– just little too close to you? The term ‘proxemics’ refers to– the distance between people– as they interact with each other. Just as body movement, facial expression can communicate a great deal of nonverbal information, so can this physical space between individuals…

Most people value their personal space and feel discomfort, anger, anxiety… when their personal space is being encroached. Permitting a person to enter one’s personal space or entering somebody else’s personal space is an indicator of the level of relationship between these persons. Personal space is the area immediately surrounding an individual, sometimes described as an imaginary ‘bubble’. Most people are very aware of others in ‘their space’, and many require the area to remain relatively clear in order to feel at ease.

The idea of personal space is rooted in psychology and there are many theories about how personal space develops and how people react to violations, and there’s even a name for the study of personal space: In the 1960s, Edward T. Hall, anthropologist, pioneered the field that came to be known as proxemics— the study of humans’ behavioral use of space.

According to Hall; personal space can be viewed as an extension of the human body and he defined– four distinct spaces or zones: Intimate zone, for whispering and embracing (within 18 inches of your body); Personal zone, for conversing with close friends (18 inches to 4 feet); Social zone, for conversing with acquaintances (4 feet to 10 feet); Public zone, for interacting with strangers (10 feet to 25 feet). You can visualize these zones as expanding concentric sectors with your body as the bull’s-eye.

Also Hall noted, that different cultures maintain different standards of personal space. The ‘Lewis Model of Cultural Types’ indicates the variations in personal interactive qualities consist of three poles, namely: ‘linear-active’ cultures, which are characterized as cool and decisive (e.g., Germany, Norway… ), ‘reactive’ cultures, characterized as accommodating and non-confrontational (e.g., China, Japan… ), and ‘multi-active’ cultures, characterized as warm and impulsive (e.g., Brazil, Mexico…). Realizing-recognizing that cultural differences improve cross-cultural understanding…

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According to Natasha Polak; in certain cultures, standing too close or far away from someone you are talking to is considered rude, and the same goes for hand gestures or physical contact, or even facial expressions. Depending on where you live, having too much or not enough personal space can be a problem!

According to Robert Sommer; the violation of personal space increases tension levels enormously… When people’s space is trespassed upon it provokes cathartic responses… Police investigators are taught to invade suspect’s personal space during questioning to gain a psychological advantage… This is the way animal trainers’ tame lions by moving forward, moving back, constantly pushing the limits…

Personal space may vary slightly depending on familiarity, gender… but we generally subscribe to a certain set of norms that are considered acceptable to most people in a given culture… However, in other cultures, personal-space thresholds may be completely different, and awareness of those differences can help international business people and politicians avoid making their clients or associates feel uncomfortable… So a conscious effort to be flexible and considerate of others’ cultural expectations will greatly improve the odds that you will put others at ease in the international business world…

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In the article What is Personal Space? by Debby Mayne writes: Think of your personal space as the air between your body and an invisible shield, or bubble, you have formed around yourself for any relationship… The distance between you and your shield most likely varies from one person to another, depending on a variety of factors, including how well you know the person, your relationship to that person, and how much you trust him or her… Personal space at work…

Observing boundaries in the office is important to maintaining professionalism… That is why you should observe professional distance while at the office and reserve more intimate gestures for after hours… Be aware of company policies regarding relationships with coworkers. Don’t assume your relationship with a coworker or supervisor is personal. Avoid hugging or other familiar gestures.

Only step into someone’s workspace if you know you are welcome. Be respectful if you sense the person is busy. Save personal conversations for the lunch break or after hours… When someone gets uncomfortably close to you there are ways to deal with space intrusion: Lean away from the person or take a step back, hoping he or she will take the hint. Come right out and say you are uncomfortable being so close. Explain why you need more space…

In the article Respecting Co-worker’s Personal Space by Lisa McQuerrey writes:  Today’s open office environments often mean employees work in close proximity to each another. For some people, this is conducive to team work, while to others, it feels claustrophobic. To maintain good relationships with your colleagues, respect boundaries, personal space and privacy…

Respecting one’s physical space means not encroaching into others’ work territory, particularly in cubicles or workstations that connect in some way. Keep your own space clean, clear and organized and situate yourself so you are physically in your own environment. Position your computer and telephone away from your colleague, not to ignore them, but rather, to help both of you avoid the distraction that another person can create. This allows you to respect personal space and it keeps you focused on your work…

Respect a person’s personal space by not standing too close when you talk, which can make some people feel as if you’re physically on top of them… In meetings and seminars, maintain physical space at tables and in chair rows so the people around you have room to stretch and move without fear of bumping elbows and knees… Be mindful about how aromatic your food and beverages are and be careful about the amount of perfume or cologne you wear…

Likewise, pay attention to your volume when you speak, both in person and on the phone, to ensure you aren’t interrupting colleagues’ work or concentration… If you walk into a room and see two colleagues in private conversation, respectfully keep your distance or come back later. If you hear a co-worker on the phone, don’t eavesdrop on her conversation, and if you do inadvertently overhear details of the discussion, keep them confidential…

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In the article Guidelines for Respecting Personal Space by Laurie Wilhelm writes: At work, at home and in our social circles, we carry with us a sense of our own personal space that we often unconsciously protect… Probably the most readily thought-of personal space is when someone gets ‘in your space’; it’s uncomfortable and you may take a step or two back to regain the physical distance you need to be comfortable again. We have different perceptions of how much space we need and someone made require more space between others than you do and body language if you’re being a space invader…

Personal space also includes specific physical areas that extend beyond our invisible space. These tend to be spaces that we qualify as ‘mine’ even if we don’t own them, for example: my work cubicle, my desk, my parking space… Be cognizant that these are people’s spaces and treat them appropriately. At work, don’t go through others desk drawers looking for a pen, don’t take their pad of sticky notes because you see they have two on their desk, and when parking your vehicle, park in the center of ‘your’ spot so that your neighbor can easily maneuver in ‘their’ spot. While none of these are really– ‘theirs’, ‘yours’… there is personal entitlement to whomever they’ve been assigned and that assumed entitlement should be respected…

Another invisible personal space, or perhaps this is an invasion of personal space, is the sound that enters into it. Invading another’s personal space with your personal noise is a sure way to cause friction. Talking loudly on the cell phone, ear-splitting, cackling laughter in the otherwise quiet restaurant, blaring stereo are all types of aural assaults on personal space… While we tend to focus on getting along with others through good social skills that revolve around what we say and how we act, we may also consider paying more attention to the personal space of those around us and being considerate of how our actions may be intrusive…

Personal space is an area with invisible boundaries that surrounds us– it’s a protective ‘buffer zone’ that allows one to maintain a sense of privacy… Personal space is highly variable and can be due to cultural differences and personal experiences… Difficulties can be created by failures of intercultural communication due to different expectations of personal space…

According to Douglas Main; everybody has ‘personal space’ or protective invisible ‘bubble’ around their body to keep themselves from unwanted intrusions… According to Hillel; personal space is your space alone; it’s your body, your thoughts, your emotions… These are yours and nobody has the right to dictate how you maintain them, keep or use them… However, there is also shared-space that are areas were we gather, work, socialize, shop… While our personal space is for our own benefit and needs, shared space is for the benefit of everyone there…

When it comes to shared space you have the absolute right to negotiate and compromise in order to get what you need. By the same token, however, you also have a responsibility to uphold those agreed upon standards. What many people do not realize is that shared space is a win/win situation. That is to say ‘everybody’ gets something out of it and in a functioning situation the division of benefits is equal…

Whereas, personal space, boundaries… are imaginary lines that help you protect yourself– physically, emotionally… Boundary setting is not about controlling; it’s really about deciding what you will and won’t tolerate… it’s about drawing a line around your personal space, boundary, bubble… that identifies your personal area of privacy…

Corporate Board of Directors is a Vestigial Entity Structurally Unable to Achieve– Time to Rethink Corporate Governance…

Corporate governance in the modern public corporation has marginalized the ‘board of directors’ function in favor of powers exercised by the corporation’s investors, senior officers… Has board of directors outlived its purpose?

The ‘law’ of corporate governance places the board of directors at the top of the corporate decision-making structure; and the accountability for major corporate decisions rests primarily on the shoulders of these part-time directors who often lack the time, thorough knowledge… that’s necessary to perform the board’s duties effectively.

According to Kelli A. Alces; the time has come to envision a world beyond the board of directors… While the board structure may be the product of prior market choice; it’s the ‘law’ not the market that preserves the vestigial board of directors’ role at the top of the corporate hierarchy… Eliminating the board of directors would mark a fundamental shift in the understanding of corporate governance, but at the same time, it would realign the law of corporate governance with natural evolution that markets have already initiated.

In recent years there have been many discussions about ‘board of directors’ reform, including; function, composition, duties… with the main focus being the ‘monitoring’ role of the board. The argument is that better monitoring will facilitate the integrity of the fiduciary relationship between– directors, shareholders, other stakeholders… In an effort to improve the board’s effectiveness in its monitoring function, boards have been encouraged to have greater, in-depth director participation and greater independence…

The typical ‘director’ of largest multi-national corporations devote about 17 hours per month to governance of the corporation. This means that the responsibility for the success or failure of corporations lies with a group of people, i.e., board of directors, who work part-time to monitor the corporation’s business, management… and who receive almost all of their information, second-hand…

Certainly the board of directors monitors corporate officers, particularly the CEO, and makes significant business decisions for the corporation, but the board of directors relies heavily on senior corporate officers– who it’s supposed to monitor… also, often these directors lacks– the time, knowledge, expertise… to effectively challenge these senior officers in order to contribute valuable independent business judgment…

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According to a McKinsey & Co report, less than 50% of the 186 board members surveyed say their boards reacted effectively to the global economic turmoil. Many of the board of directors; did not know what to do, or how to do it, which has kept them from being proactive in helping their companies deal with the crisis… There are no cut and dried formulas and few black or white choices for boards to follow. In today’s pace of global business means boards have to respond quicker, and the luxury of time to mull it over or decide next quarter is no longer available.

So how can the CEO and Chairman guarantee that the board is fully functioning and effective? The selection of board members is one of the key routes to building effective boards and will always remain important. But selecting the most experienced players doesn’t mean the team will be effective… A board position is hard work and requires a serious commitment; but many see it as just a perk for elder statesman or as reward for family, friends, colleagues…

It’s a great status symbol. But, in order for board members to be effective and fulfill their fiduciary duties, they must be good corporate citizens having– relevant information and knowledge, relevant experience, relevant industry expertise, passionate about the product, employees, company… and proactively involved in corporate affairs… Board members cannot just be place-holders to fulfill diversity objectives…

In the article Rules for Corporate Governance Success in the Social Age by Barry Libert writes: It’s time for directors to think anew about the meaning of corporate governance in the social age. In addition to their existing roles, boards now have the added responsibility of shepherding their leaders and organizations into today’s digital world. Boards that avoid this obligation risk having their organizations fall prey to the speed and force of today’s social networks, as they seek corporate reform and accountability…

So how does a corporate director think anew about his or her role? Consider the following: Rethink Strategy: Boards need to align their strategy with where value is found today. In the industrial age, value was based on the amount of an organization’s physical assets and manufacturing capabilities. In the social age, value is a function of the size and vitality of an organization’s network and how well it is connected both inside and outside company…

Rethink People: As corporate directors, board members need to fully understand that an organization’s next big idea may come from anywhere and anyone. As such, corporate directors must engage their management team, employees… and act as the catalyst for leveraging the collective wisdom for innovation…

Rethink Process: Yesterday, companies focused on their internal processes to maximize execution and improve efficiency. That ‘inside-out’ focus worked in a supply constrained world in which customers had few choices. But today, consumers can buy from anyone and everyone, both online and off. As such, boards must engage management and shift their focus from ‘inside-out’ to ‘outside-in’ to drive growth…

Rethink Technology: Technology is not just about IT policies; it is also a strategic asset that can be leveraged for success. Boards must play a prodding, if not active, role in ensuring that management think anew about its technology strategy and how it can add value and minimize risks by actively integrating today’s social, mobile, cloud, and big-data technologies into everything it does…

Rethink Leadership: The concept of traditional, top-down management is quickly losing steam in a world in which everyone has a voice– including; customers, employees, partners, investors… Social technologies allow people to say and publicly share whatever they want about an organization, its leadership, culture… In the context of increasing demand for accountability, transparency and open approaches involving all stakeholders, corporate directors must think anew about their board composition and competencies…

Rethink Finance: Boards and leaders hold a number of historical and framing biases that make it a challenge for them to see and invest in today’s ‘intangible’ and unmeasured sources of value, such as; social network membership, intelligence… This is especially critical given that less than 25 years ago, physical and financial assets constituted about 80% of corporate market value. Today that amount is less than 20%. As such, leaders must think anew about their capital reallocation strategies, especially given research by McKinsey that indicates that most companies continue to invest in the same things that they invested in last year…

Rethink Governance: The future for boards is less about traditional governance and regulatory compliance, and more about network alignment, capital real location to new sources of value and technology, business model strategies… Looking backward through the lens of financial reporting will only go so far. Today, boards require social intelligence about the future desires and needs of stakeholders. Leveraging real-time data from social technologies and mobile networks offers a more complete view on what is coming next…

Bottom line: Boards must think anew about their role in the social and mobile world. For corporate directors, there is no time to waste. Directors must join the social and mobile ranks…

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In the article Rethinking Corporate Boards by M. Todd Henderson and Stephen M. Bainbridge write: Corporate boards have a daunting array of tasks, including hiring and firing the chief executive officer, setting the CEO’s compensation, monitoring the CEO’s decisions, ensuring compliance with laws, and above all, representing the interests of shareholders and other stakeholders…

Critics have long complained that boards are not up to the task… There are many reasons boards fail to police corporate management or make good decisions: Directors are part-timers with weak incentives and limited information. They also are generalists, meaning the average board is unlikely to have all the experts it needs at any given time. CEOs often pick directors based on unknown or non-relevant set of factors, and shareholders have no information about how board decisions are made or how individual directors perform…

Corporate governance experts have proposed many reforms, some of which ended up in the Sarbanes-Oxley Act and the Dodd-Frank Act. All the reforms share several unattractive features; ‘one-size-fits-all’ notwithstanding the huge differences across companies, industries… and many reforms rely on academics or other ‘experts’ who apparently know more about what is good for a particular companies than the management team themselves…

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So lessons learned: Corporate governance requires rethinking of its; roles, responsibility, structure, accountability… While the purpose and composition of the board have changed over time, the basic structure and institution of the board has remained constant. We currently expect the board of directors to perform two functions; monitor and manage. These functions are consistent with the notion that the board is responsible for managing or directing the management of the firm…

According to Kelli A. Alces; understanding the reality of corporate decision-making and developing a governance structure that openly acknowledges it is essential to providing more efficient, effective corporate management. Board structures should be tailors to the specific needs of a company. For a growing company in developing field faced with variety of strategic decisions or an inexperienced CEO, the board’s management role may become its primary focus. Therefore the role may require board members with developed expertise who have business relationships…

On other hand when a company is well established with dispersed body of shareholders, the monitoring function of the board may be more important relative to its management functions. Therefore, the board should be made up of sufficiently independent board members who are able to monitor company’s dealings and transactions…

According to Sir David Walker; the principal deficiency in boards is the way directors behave: They don’t challenge the executives enough– there must be a disciplined process of challenge on corporate policy, strategy, ethics. Independence of mind is more relevant than formal independence. Leadership skill of Chairman of the board is important, too; together with the ability to competently deal with major strategic issues…

According to Kelli A. Alces; the metamorphosis of corporate governance will not happen until the 19th century concept of the limited liability company is rethought and brought in line with the reality of business in the 21st century…

 

Got Courage, Courage to Act in Business– Transform, Innovate, Challenge, Push-Back, Move Forward: It’s State of Mind…

Courage is the nature of leadership in business– the courage to hear the distant drumbeat of change and run, not walk, toward it… Courage is defined in many dictionaries as the mental or moral strength to venture, persevere and withstand danger, fear, difficulty… Courage is not acting in the absence of fear, but in spite of it…

The origin of the word ‘courage’ is from the Latin word ‘cor’ meaning ‘heart’, and it offers an image of people at their best. According to Jim Hightower; the opposite for courage is not cowardice, its conformity… even a dead fish can go with the flow… According to Sheila Johnson; a person who is courageous in business is one who can take a different road, be unique, a person with high standards and integrity who does not lose focus…

Courage in business leadership is expressed in many ways: It can be changing a vision, strategy, maintaining an ethical stance in the face of personal risks… Courage can be a key factor in driving out the fear that is prevalent in many companies. It can be about holding to a different strategic choice in the face of severe questioning from industry analysts and others… Courage for a business leader can be confronting employees directly affected by downsizing decisions and making yourself vulnerable to their criticisms and anger.

Courage is caring enough about your values that you uphold these in the face of risks… According to Lisa Lane Brown; when I talk about courage, I’m not talking about traditional ‘save a child from a burning building’,  I’m talking about the ‘courage to win’… the power to reverse learned helplessness, and take congruent action on your dreams despite fear, rejection, intimidation…

According to Nelson Mandela; I learned that courage was not the absence of fear but the triumph over it. The brave man is not he who does not feel afraid, but he who conquers that fear… Business leaders can foster courage in their organizations by modeling positive behavior and by praising-rewarding those employees who bring ‘issues’ to light…

Fostering small acts of courage can lead to more prudent risk-taking that may ultimately save the company from embarrassing ethical breaches… To make such decisions requires courage and without it enterprises could not exist… The time has come to reflect more maturely on all the qualities it takes to start and manage a successful enterprise; qualities that include; patience, prudence, determination, clear-headedness, flexibility, honesty– and mostly ‘courage’…

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In the article Courage in Leadership by Peter Voyer writes: Courage is a necessary trait of effective leadership. And, it’s hard to argue that other traits such as; integrity, honesty, altruism, communications skill and decisiveness are not qualities of a good leader. But, leaders could not display these traits if they didn’t have courage.

According to General George Patton; the most important quality of a good leader was a willingness to make decisions: This takes courage… It’s the strength of character to persist and hold on to ideas in the face of opposition. Here, I’m not restricting my treatment of courage as it relates to fear. It’s also about strength of character and devotion to causes and ideas, and to tell the boss what he/she does not want to hear, or reprimand an employee, or make unpopular decisions. Most of all, it takes courage to be a leader…

In the article Courage in the C-Suite by Rosabeth Moss Kanter writes: To ‘act’ requires courage. To innovate requires even more courage. Courage makes change possible. Intellectual courage is necessary to challenge conventional wisdom and imagine new possibilities. Leaders must refuse to accept limits or stop at imaginary  boundaries… In troubled companies, it’s a familiar pattern: Managers equivocate in response to a new initiative, observe struggles without helping, withhold resources, hedge bets, hoard information, go passive… I call such behavior the timidity of mediocrity…

Courage doesn’t imply absence of fear and most heroes are scared to death, but act anyway. Innovators know that they’re taking risks but that doesn’t mean being foolhardy… Courage comes from caring deeply about achieving a shared goal. When others are counting on you and backing you, and when you’re acting in the service of others rather than for personal glory, courageous deeds are easier. Courage has a collective component, even if manifested in individual actions…

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In the article Courage in Business by Edyta Pacuk writes: I find that without courage there is no movement. Without courage we cannot bring thought leadership, we cannot break paradigms, grow, change and challenge the status quo… According to Peter Drucker; whenever you see a successful business, someone once made a courageous decision. There is always an act of courage which is the magical ingredient that contributes to organizational success. Even if that courageous decision is not right, there are always major learning’s to be captured – and those learning’s can help the organization to (re)focus, (re)energize and ultimately (re)claim success…

Security is a myth. It doesn’t exist... Avoiding risk is no safer in the long run than facing it. However, many organizations promote risk taking but only if the outcome is safe, suggesting that; we need to innovate but we cannot fail… If we always try to make things perfect, without some risk, we will probably not accomplish much. Over-thinking and lacking courage to go without all the data may cause us to miss opportunities and finally settle with mediocre results…

Yet it’s important to remember that courageous in business does not mean lacking fear… And, we should fear the fearless leaders… To have courage is to be able to face fears; its how we overcome, persevere, stand behind ideas… Not because we seek security but because we are prudent in moving the business forward….

In the article Sustaining Courage by Monica C. Worline writes: Leaders who act with courage are not fearless. Fear can serve as a reminder to be mindful… The experience of courage in an organization produces feelings of inspiration that can change people’s sense of what is possible. Stories of courage often carry the same feelings of inspiration and expanded possibility, and finding, sharing, celebrating… visions of what is possible can sustain a sense of courageousness…

Action outside of usual bounds that serves the mission of the organization will inspire others… There is a difference between courage that inspires and heroics that violate connections between people and put integrity of the organization at risk… Aristotle taught that– courage is the balance between being overly afraid and overly confident…

Leaders who are sustaining courageousness in their organizations often will do things that build trust and respect; it brings the organization alive for people. An experience of extraordinary activity that serves the organization creates a visceral and sensual experience of the organization at its best, deepening people’s understanding and commitment to the mission and vision of the organization. Leaders who sustain courage in trying times share their successes and their heart breaks, conveying stories that bring the organization alive for its members…

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A leader’s story is a story of courage; without it– we won’t get started, we won’t take right actions– we live in fear of the consequences… Every day we face decisions that begin, interrupt or sustain our courageous-life pattern… It’s a vital character trait for a leader whether wearing combat boots or a business suit. To be a leader of character, you must develop the courage to act no matter what the actual or perceived risks may be: Leadership takes courage. Innovation involves creating ground-breaking but tradition-defying ideas: Innovation takes courage…

Contrary to popular belief, courage is teachable and learnable skill, and most everyone has capacity to be courageous. Moreover, nearly all courageous acts represent one or more of these three types: 1) The courage of initiative and action– making first attempts, pursuing pioneering efforts and stepping up to the plate… 2) The courage of confidence in others–letting go of the need to control situations or outcomes, having faith in people and being open to new direction and change… 3) The courage of voice– raising difficult issues, providing tough constructive feedback and sharing unpopular opinions…

According to Winston Churchill; courage is what it takes to stand-up and speak; it’s what it takes to sit-down and listen. According to Susan Tardanico; demonstrating leadership courage– whether it’s having uncomfortable conversation, communicating when you don’t have all the answers, making a decision to move ahead– can be scary. Yet it’s precisely the kind of behavior that fosters trust and sets a crucial example for others to follow at a time when they’d rather hunker down and wait for the storm to pass...

People who move ahead welcome new ideas: They listen; they adapt; they are constantly learning and challenging themselves: Anything is possible… but you must be willing to get in the game, make mistakes, learn from them, and then move on– wiser and stronger… You cannot have success without failure: The two are inextricably linked. So if you’re afraid to act because you might make a mistake; stop and think again…

Roadblocks and setbacks provide us with the information we need to grow, change, and make a move in the right direction… After all, it’s through our failures that we gain experience. So move forward with courage and know that you are headed in the direction of success… Embrace the unknown… If you can learn to embrace the unknown, courage will follow. To find true courage, you have to be committed to finding it…

Don’t be afraid to try new things and take on unknown experiences… Let your conscience be your guide and roadmap. Take a stand against injustice and don’t let it derail your progress. Some of the most courageous people in the world have become just that because their conscience simply wouldn’t allow them to ignore what was happening around them…

Let fear-in and overcome it: Courage is not the absence of fear… true courage is feeling fear but doing what needs to be done anyway... Become an active participant in your life goals and business dreams, and most important; never give up! It takes both courage and determination to truly go after what you want, and take-do what may seem to be unattainable and make it attainable. If you’re feeling down or a business deal falls through; pick yourself-up and keep moving. Courage is not merely word; it’s state of mind…

Age of Aerotropolis– City Centered Airport– Economic Driver of the Future: Global Business Imperative vs. Terrible Idea…

Aerotropolis is a large city centered on an airport… In its purest form, the aerotropolis is an economic hub that extends out from a large airport-city into a surrounding area that consists of– distribution centers, office buildings, light manufacturing firms, convention centers, hotels… all linked to the airport via roads, expressways (aerolinks), and rail lines (aerotrains). The business-centered version of aerotropolis is also called an air-commerce cluster or an airport cluster…

The word aerotropolis combines prefix aero- and the word metropolis, a large city. It’s also called an aviation city or an airport city. It’s a new urban form placing airports in the center with cities growing around them, connecting workers, suppliers, executives, goods to global marketplaces… According to Michael Brink; speedy delivery of goods is at center of  aerotropolis; a population and business center formed around an airport in the way that cities once formed around ports or crossroads…

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The term aerotropolis was made popular by Dr. John D. Kasarda based on his research on airport-driven economic development. According to Kasarda; airports have evolved as drivers of business location and urban development in the 21st century in the same way as did highways in the 20th century, railroads in the 19th century and seaports in the 18th century. As economies become increasingly globalized and dependent on electronic commerce, air commerce… the speed and agility they provide for the movement of people and goods is the new logistical backbone… According to Paul Romer; very few people realize how profoundly air transport is changing– cities, economies, social systems, systems of governance… But, according to Eno’s Schank; people don’t want live next to airport because it’s not a pleasant place. It looks industrial. It looks sprawled out. And they don’t want to work in a place like that… (developers) think humans are automatons and will just go where it’s most convenient. But will people pay a premium to live next door to an airport? I doubt it…

In the book Aerotropolis: The Way We’ll Live Next by John D. Kasarda  and Greg Lindsay write: This concept of a new phenomenon called the aerotropolis gives us a glimpse at the way we will live in the near future– and the way we will do business, too. Currently, most airports are built near cities with roads connecting the one to the other. This pattern– the city in the center, the airport on the periphery– shaped life in the twentieth century from the central city to urban sprawl.

Today, ubiquity of jet travel, round-the-clock workdays, overnight shipping, and global business networks has turned the pattern inside out. Soon airports will be at the center and cities will be built around them… which keeps workers, suppliers, executives, goods… better  engaged with the global markets.  As more aviation-oriented businesses are drawn to airport cities and along transportation corridors radiating from them, a new urban form is emerging– the aerotropolis; stretching up to 20 miles (30 km) outward from some airports.

Analogous in shape to traditional metropolis made up of a central city and its rings of commuter-heavy suburbs, the aerotropolis will consist of an airport city and outlying corridors and clusters of aviation-linked businesses and associated residential development. A number of these clusters already exist, such as; Amsterdam’s Zuidas, Las Colinas, Texas, South Korea’s Songdo International Business District…

these airport edge-cities represent planned modern urban mega-development in the ‘age of aerotropolis’; the combination of giant airport, planned city, shipping facility, and business hub… Already the aerotropolis approach to urban living is reshaping life in many major international cities… and we urgently need to understand this changing world and our place in it…

In the article Aerotropolis: Key to a Prosperous, 21st Century City? by Barbara Porada writes: The rapid expansion of airport-linked commercial facilities is making today’s air gateways the anchors of 21st century metropolitan development– where distant travelers and locals alike can conduct– business, exchange knowledge, shop, eat, sleep, entertain without going more than 15 minutes from the airport. This functional and spatial evolution is transforming many city airports into airport-cities…

The aerotropolis, like a traditional city consists of central core with rings of development permeating outwards; but unlike a traditional city, the core is an airport– and all neighboring development supports and is supported by the airport industry. Several airports around the globe have organically evolved into these airport-dependent communities, generating huge economic profits and creating thousands of jobs… Looking back on city development, it quickly becomes clear that cities have almost always been an outcome of, and had a strong relationship with, the form of transportation that was relevant during the time of their establishments.

In the U.S. the first modern cities developed around seaports and then towns popped up along rivers and canals. Next the invention of railroad opened up previously hard-to-reach inland areas to manufacturing and distribution. In the 20th century, highways facilitated the greater dispersion of people and companies by creating suburbs… and, more recently the world’s airports have turned into– primary drivers of urban growth, international connectivity, economic success…

A nation’s airports are vital contributors to the economy: For example, Chicago‘s O’Hare International Airport is 2nd largest office market in the Midwest and Washington DC’s Dulles airport area has more retail sales than any other U.S. city besides Manhattan. While the aerotropolis vision is an economically enticing one and has already set many gears in motion around the globe, we need to stop and consider the bigger picture: How will this model change the way people live?

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In the article Aerotropolis by Sara writes: Using the airport as a model to build a city is a great idea in order to start thinking about– the city, its structure, and its infrastructure in terms of an open architectural model. A model that incorporates mobility into its day-to-day operations: The techniques of the airport, the harbor, the factory, the Internet… and the elasticity of their structure-formation should be considered as ways of thinking about the modern city and its formation…

However, considering these models would require the deconstruction of old rules, old ways of thinking and the embracing and developing a new reference system, a new set of rules… The concept of developing an urban plan in which the layout, infrastructure, and economy is centered around an airport is an interesting concept, in theory, but as I read more about John Kasarda’s ideas I began to question the logistics.

According to John Kasarda; the global business network has changed air travel in order to accommodate the demand for overnight shipping… however, most airports are built at the periphery of cities, which is an outdated model… John Kasarda believes that major airports are the key nodes in global production, enterprise systems… offering speed, agility, and connectivity. He boldly states that — ‘Aviation is the 21st century’s physical Internet’ supplying fast long-distance connectivity.

However, in my opinion, the major flaw in John Kasarda’s concept is that his development model relies exclusively on fossil fuel… He is not an urban planner so he is not providing a new model but relies on the same development patterns are already in use… its old thinking with a new twist…

In the article Aerotropolis by Diane Coyle writes: Cities are fundamentally shaped by transportation: The underlying premise is undeniable– the oldest were organized around water, a navigable river or port, Victorian cities were expanded and shaped by train lines, and since the early 20th century automobiles and major road networks redrew domestic trade and commuting routes, and enabled the spread of suburbs…

Aerotropolis argues that in age of globalization, air travel has altered choices about work, home locations, business location… and will only continue to do so. The question is whether urban authorities go about dealing with this in a haphazard way– as in London, where finding agreement about where and how to expand airport capacity seems impossible– or in a planned way with a sufficiently large international airport connected to residential areas by convenient public transport and with sensible mixed-use zoning nearby…

The economic benefits of physical connectivity are often underestimated– many people have certainly made the mistake of assuming that the information-communication technologies can substitute for face-to-face contact, when in fact they complement each other. It’s interesting to note that the highest-technology industries clock-up the most executive travel… trillions of ‘connections’ yield billions aloft– the more wired we are, the more we fly… The aerotropolis concept says that the airport is the center and the city is built around it… which is better for workers, suppliers, executives, goods… for being engaged with global market… The aerotropolis is a combination of giant airport, planned city, shipping facility, business hub…

According to Brian Merchant; for many people, building an entire city around an airport probably seems like a terrible idea– First, airports just aren’t fun– especially in the U.S.; they’re irritating places and filled with never-ending lines, over-priced food, irascible TSA agents… and that’s to say nothing of the pat-downs. Second, they’re usually sprawling, aesthetically offensive and loud, and most cities go to good lengths to relegate its airport to the outskirts of the city… For some planners, the concept of the aerotropolis is a solid, adequately ambitious vision for the cities of the future– yet, for others it’s a terrible idea…

Metropolis pokes a few holes in the economic theory behind the concept, pointing out that the aerotropolis is essentially a glorified company town, whose economy is pegged to the corporations that produce goods and ship them… If the industry is wired to the air freight infrastructure and it declines, then so does the city… According to Greg Lindsay; successful cities have always been founded because of trade– these are places where people exchange goods, money, ideas…

The world is poised to build literally hundreds of new cities as 3 billion people urbanize over the next forty years. So where would you put a new city today? And how would a city in western China– historically the middle of nowhere– connect to the world? The answer is the airport. In global economy, where trillions of dollars in goods and billions of people are following digital bits around the world, sooner or later we would end up building cities defined by their airports, because the only geography that matters is economic geography. It sounds like science fiction but it’s always been this way…

One of the reasons that China, India, petro-states of the Persian Gulf are sinking billions into their airports, airlines and new aircraft is because they’re trying to go from backwaters to global hubs practically overnight, creating a ‘New Silk Road’ running all way from Beijing to Johannesburg.  It isn’t a literal road– it’s made up of air routes: One thing about the New Silk Road is that it has nothing to do with the U.S. It’s about rewiring the global economy so that it runs through the East, not the West…

Got Klout, Klout Score– Measures Everyone’s Degree of Influence on Social Media: Relevant or Too Goofy to Ignore…

Klout Score: Much as Google’s search engine attempts to rank the relevance of every web page, the Klout Score ranks the influence of every person online… Its algorithms comb through social media data; then if you have a public account with Twitter, which makes updates available for anyone to read– you have a Klout Score whether you know it or not (i.e., unless you actively opt out on Klout’s website).

You can supplement that score by letting Klout link to harder-to-access accounts, such as; Google+, Facebook, or LinkedIn. The scores are calculated by using variables that can include; number of followers, frequency of updates, the Klout Scores of your friends and followers, and the number of likes, retweets, and shares that your updates receive… High-scoring Klout users can qualify for ‘Klout Perks’, free goodies from companies hoping to garner some influential praise… But even if you have no idea what your Klout Score is, there’s a chance that it’s already affecting your life…

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Klout is a tool that measures social influence across the web. The higher the Klout Score, the higher the social influence; influence is defined as the ability to drive action such as– sharing a picture that triggers comments, likes, tweeting… for example; about a great restaurant that causes your followers to go try it for themselves… Social actions are a signal that friends and peers in your social networks have been influenced by your content… The Klout Score is a numerical value between 0 and 100. In determining the user score, Klout measures the size of a user’s social media network and correlates the content created to measure how other users interact with that content…

Klout utilizes Twitter, Facebook, Google+, LinkedIn, Foursquare, Wikipedia, Instagram data… to create Klout user profiles that are assigned a unique Klout Score… However, some experts object to Klout’s methodology regarding both the process by which scores are generated and the overall societal effect. Critics say that Klout Scores are not representative of the influence a person really has…

According to John Scalzi; principle behind Klout’s operation are ‘socially evil’ in its exploitation of its users’ status anxiety… According to Charles Stross; the service is the ‘Internet equivalent of herpes’ and he advises readers to delete their Klout accounts and opt out of Klout services…  According to Ben Rothke; Klout can and should be applauded for trying to measure this monstrosity called social influence but their ‘results of influence’ should, in truth, carry very little influence…

In the article Klout Score: What’s In a Number? by Jenn Herman writes: Klout allows us to compare ourselves to others as well as mark progress over time. In all fairness, there is a lot of debate about the algorithms and metrics that Klout uses to achieve its rankings. But we all still talk about it and we all still check our scores. How much clout you believe Klout has, may vary, but we still know our score.

So, what’s in a number? What is good and what is bad? Why does it matter? According to Klout’s website; average score is 40. And anyone with a score of 63 or higher is in the top 5% of social media influencers. So, why do these scores matter? Well, if you were looking for a social media manager or someone to help grow your online strategy, would you hire someone with a score of 23 or a score of 70? If you are looking to reach new customers would you want to have more influence than your competitors? If you wanted to partner with another company, would you want to partner with one with no social influence, or a significant social influence?

Once you are signed in to Klout, you can search for others and check their scores. Check out your own company’s score and see how it stacks up against your competitors. When you’re looking to hire a new social media administrator, check their score and don’t be afraid to ask them to validate their score. But what if your score is low and you want to raise it? The most important thing is to be active and engaging on social media…

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In the article What Your Klout Score Really Means by Seth Stevenson writes: Klout is starting to infiltrate more and more of everyday transactions, for example; Salesforce.com lets companies monitor Klout Scores of customers who tweet compliments or complaints; those with highest scores will presumably get swifter, friendlier attention. Gilt Groupe began offering discounts proportional to customer’s Klout Score… But, not everyone is thrilled by the thought of a company using mysterious, proprietary algorithm to determine what kind of service, shopping discounts, or even job offers we might receive…

The web teems with resentful blog posts about Klout, with titles  such as; ‘Klout Has Gone Too Far’, ‘Why Klout Score Is Meaningless’, ‘Delete Your Klout Profile Now!’… According to Jaron Lanier; she hates the idea of Klout… People’s lives are being run by stupid algorithms more and more… However, Klout may be ridiculed by those who find it obnoxious or silly or both, but it’s on track to become one of the pillars of social media…

In the article Raise Your Klout Score by Michael Brenner writes: Many people hate Klout: Hate what it is, what it does, why it exists… I’m not looking to debate the merits of Klout, but to simply explain the tool that it is… Klout seeks to measure your degree of influence in the online social media world. It measures both– size of your network across many major social media channels and it measures the amount of engagement you get from that audience.

It is a score that ranges from 0-100. If you have an online profile on any of the major social networks, you have a Klout Score… Many people initially criticized Klout because initially it was very focused on Twitter engagement. This caused Justin Bieber to have a higher Klout Score than the President of the United States. So Klout updated the algorithm to include Wikipedia ‘mentions’ (quantifiable measure of offline influence). This caused poor Justin to move from perfect 100 to 92 and Barrack Obama to near-perfect 99…

There are also competitors to Klout out there such as; Kred and Peer Index and many others. But Klout seems to be pulling away from the pack. You should care about Klout because like your personal brand, you already have one (i.e., Klout Score). You just might not be paying attention to it. Companies are starting to pay attention to it and may look up candidate scores when hiring.

But Klout is not an end in and of itself. It is an attempt to measure your online influence and like any tool has its flaws. A low Klout Score does not mean you are a bad person and a high one does not make you better than anyone. Mostly, I think Klout is just one of many tools that can help you measure the impact that various activities have on your score…

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In the article What Is Klout Score? Why It’s Important? by Michael Cohn writes: The variables that go into calculating a Klout Score are interesting and important for business: Understanding where you stand as a business owner within the sphere of influence is critical to the success of your business. If you don’t have a way of tracking how much influence you have, you will never be able to grow and change in a positive direction…

Of course, it takes time to increase influence and there are many ways to go about doing that, such as making sure that your content is top-notch, initiating as many discussions as possible, finding trends that have been around for a little while and re-amplifying them and connecting to as many high-quality networks as you can. The Klout Score gives you a solid way to track your influence level so that you can continue to increase it over time…

In reality, Klout Score is just a number, and what is most important in social media is if it is helping you meet your business or personal goals. Many use social media to network with other professionals primarily, but also to learn about– what’s happening in their industry, to inform people about services, get referrals, and to gain new business… The results can be somewhat subjective, for example; great new business connection, new friendship… but, it can also tie directly to the bottom line, like new customers…

So what it comes down to is that the Klout Score is only one of many factors in determining the success of social media for your business… According to Jill Duffy; for individuals, Klout largely tells you what you already know about yourself and your social networking habits. For business users, especially teams who are managing one account, it’s a different story, giving a very general snapshot of activity and success rate day-by-day over a month. For tips and tricks to improve, though, users will have to turn to other sources for advice…

According to Elijah Young; Klout is relevant because it measures things: Clients want to know ROI; managers want to know campaign reach, and so on. Klout is the closest thing we have to a social media credit score… There are several metrics that are important but there is no proverbial ‘one number to rule them all’…

The real question is; is it effective? Unfortunately, you have to define the word effective for your brand. On one hand, Klout does give you a set of ‘golden rules’ to live by online, e.g., join conversations, mingle with important people, make sure that you’re sending out valuable information and be there consistently. Who can argue against that?

If you’re a brand that’s simply engaging with an audience and wants to know if you’re in the right ballpark, I don’t see Klout’s deficiencies as reasons to avoid the metric all together… If you’re a brand that intends to use Klout to reach out to the influencers in a certain niche, then I would have to caution you against Klout… According to Miriam Slozberg;  a strong social media presence is expected of professionals involved in any kind of marketing, PR, coaching, writing, politics, music, entrepreneurship– the list goes on.

One way to find out how engaging you are online, and if others in your networks are receptive to your content is your Klout Score. In fact, employers in marketing firms require that applicants have a high enough Klout Score to indicate that they are active on their networks. And what’s more surprising? Hotel upgrades, better customer service, and other perks can come with having high Klout Scores…

According to Norman Witte; Klout has always been something of a joke. I have seen people get tagged for influence on anything from squirrels to magic. Just like everything else on the Internet, it’s imperative to take control of your digital destiny, rather than allow someone/something on the Internet to determine it for you…

 

Key Business Drivers– Major Impact on Business Performance: Managing–Must Factors: Value, Growth, Innovation, Cost…

Business drivers are critically important factors that determine, or cause, an increase in value or major improvement of a business… business driver is a resource, process or condition that is vital for the continued success and growth of a business.

A company must identify its business drivers and attempt to maximize all key factors that are under their control. A key business driver is something that has a major impact on the performance of the business… and needs to be constantly updated to be in sync with the latest trends in their markets, technology…

According to Entrepreneurship; typically there are two types of companies: There are those that do not measure and monitor much and instead drive their business by ‘seat of the pants’ decision making process. Other companies manage and monitor everything. The key is not to get stuck in the weeds and get paralyzed by analyzing too much data– know what the 4-5 key drivers of the business are. Know what leading indicators are most likely to show an increase or decrease in performance for 1-2 quarters ahead, and what the company is doing to improve those measures…

Management must understand the key drivers of their business, measure them, and then fine tune their operations to run as efficiently as possible… The world of business is a competitive– a sink or swim arena… A whole range of internal and external factors affects the performance of every business and the secret is to focus on a handful of key drivers that are:

  • Business factors that have ‘major’ impact on performance…
  • Measurable…
  • Comparable to standard– prior years or industry…
  • Actionable…

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Sales or revenues are one indicator that is easy to monitor and most businesses measure it at least monthly, but many measure it daily or even hourly. But sales, itself, might not be the major driver for the business; in fact, it could a subset of sales, such as– the number of sales calls, or the follow-up service campaign, or the amount of traffic that hits the website, or sales may not be major factors that impacts business performance.

Management must truly know and understand the dynamics of the business and focus on the few factors that have major impact on performance. The range of business drivers varies enormously from business to business. For example:

  • Sales leads in a capital goods or service business.
  • Sales per square foot in a retail business.
  • Machine downtime in a factory.
  • First time fix in a maintenance business.

Even direct competitors may use different drivers to improve their business performance. For example, prime location is not a key driver for an internet-based business, but it is for ‘bricks and mortar’ competitor that relies on well-located retail stores to attract foot traffic. Ask yourself: What are key factors that enable the business to outperform competitors?    Try to identify the ‘few’ business factors that you must focus on by asking yourself several  other basic questions, such as:

  • What drives growth?
  • What drives costs?
  • What drives cash-flow?
  • What drives customer satisfaction?

For most companies key business drivers are related to– major cost-efficiency, growth-effectiveness, customer satisfaction… Business drivers often include ‘soft’ factors, for example; effective networking (i.e., ability to build new business relationships) can prove to be a key driver for many businesses… The measurement of these factors can sometimes be indirect, for example; if you identify employee morale as a driver, you could monitor it by tracking voluntarism, absenteeism…

Drivers often change with business circumstances and time due to, e.g., growing business, changing markets, changing technology…  Also, the key drivers can change with the evolution of a business, for example; a ‘startup’s key value drivers’ might include; assembly of a strong management team, seasoned and influential board of directors and advisory board, development of compelling business plan, ability to produce demonstrable prototype of product…

‘Early-stage venture’s key value drivers’ might include; completion of a first commercial version of the product, attracting first paying customers… ‘Maturing business’ key value drivers’ might include; strengthened management team, expand infrastructure, distribution-customer support… According to Bersin; drivers are business issues or challenges that drive decisions, to change process, system, organization…

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In the article Four Fundamental Drivers for Business Success by Loreen Sherman writes: The four fundamental drivers for success are; innovation, quality, speed, cost competitive. Innovation is important because in a changing world new products and services help the organization gain a competitive advantage by being first to market. Quality is important because organizations grow on repeat business. The product or service must excel for the client to recognize and return for more.

A company’s reputation is esteemed by excellent products. Leadership development helps managers set excellent quality standards and motivate their staff in doing so. These business skills help drive and promote business growth. The world continues to rapidly change with many new technology advances, thus making many products-services more easily accessible.

Speed relates to how quickly a company can develop and release a product to the market. Cost competitiveness means that your costs are kept within a fair market price to attract and retain customers by giving them high value. Each of these four drivers is important for business success. What are your four fundamental drivers for your business?

In the article Real Drivers for Growth by Sarah Savvas writes: Measuring and giving attention to your key value drivers are the enablers for– increase revenue growth, build customer loyalty, retain quality employees, improve profitability… These are the activities that are most likely to increase business value in the shortest amount of time possible.

The ‘key performance indicators’ (KPIs) from your list of value drivers are the activities that directly impact progress towards your goals and are most critical to success. KPIs are the activities you must track for they are the key facets of any business where quantifying results can reveal problems, suggest solutions, and provide a better understanding of the business… Value drivers and KPIs can be generic, industry-specific, or business-specific. To identify key value drivers in any business, start by using SWOT Analysis (strengths, weaknesses, opportunities, threats)…

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Today’s business environment is not just about survival, it’s about focusing on and creating sustainable value. But, which elements of a business are capable of creating value? Equally important, which elements of a business are capable of destroying value? Proper business planning is the process of uncovering and identifying what creates and drives value…

Value drivers are at the root of business performance because they are frequently ‘leading indicators’ of performance, whereas financial indicators are ‘lagging indicators’ due to the recordation of past performance… Value drivers are factors that have a major influence on the value of a company and they typically include: growth, margins, capital investments, working capital, risk, tax rate, capital structure… In turn, each value driver has its own set of drivers, for example; growth is driven by market penetration, market expansion, degree of competition…

These drivers and the way they influence business value will differ with each organization and industry… According to  tripp; the first key value driver is ‘people’, and the second key value driver is business ‘brand’. Brand can be one of the greatest assets for the business, and as the concept of ‘brand’ continues to change and evolve, it continues to be a critical element for the long-term success of the business.

According to Reputation Institute; measuring-managing business ‘reputation’ is a key business driver and some argue that ‘reputation’ doesn’t matter… But, this view ignores the entire concept of reputation, which focuses on what people expect from a company. It looks beyond products and services in areas such as open and honest communication, playing active role in society on issues that matter– people, leadership and governance, strong performance…

For many companies, creating long-term business value is obviously an explicit objective– yet, only a handful of business people can actually identify, with precision, those factors that have the greatest impact on their business– let alone, linking these factors to concrete activities that management must focus on to maximize it.

The quest for long-term business value starts, therefore with a clear understanding of the variables that actually create value in a significant way, which are the key business value drivers. And these drivers in order for them to be useful, they must be controllable or at least manageable to a certain degree. In most cases, key value drivers need to be broken down into concrete components that can be prompted to action, for example; it’s not enough to determine ‘cost’ as a key value driver– for it to be useful a company needs to go deeper– at least a couple of levels into its components…

Identifying and using key value drivers are not an easy task, because key drivers are interconnected and don’t necessarily work in isolation, for example; what may be achieved by managing one value driver may have unintended consequences at another different level in the organization, or even affect value generated by another driver…

Value driven management aligns the company’s operational and financial tactics with its long-term strategy. It allows management to focus on what can be done today to create value in the future and adjust the course as needed… According to Shelley Mika; many argue that ‘innovation’ is the most important driver, that is; business’ ability to come up with new ideas, rather than settle for marginally better ideas… Better, doesn’t work anymore: Different does…

Management must create conditions in which innovation can thrive in their companies. According to Clifton; four types of people drive innovation: inventors, entrepreneurs, extreme individual achievers, and super mentors… Companies must find and keep visionary leaders who know how to foster innovation and creativity in their employees… Identifying and managing value driver helps management focus their attention on activities that have the great­est impact on value. This enables management to translate the broad goal of value creation into specific actions that most likely will deliver value.

Business drivers are key elements that either build and/or protect the value of the business… To identify the drivers on which to focus, management must address two key questions: Which factors will have most significant impact on the value of the business? Which of those factors can be most effectively managed?