Reported from ELP’s Sandy and Orem meetings. Rich Christiansen, author of Bootstrap Business and The Zig-Zag Principle, spoke with us about implementing the Zig-Zag Principle into our business efforts to achieve success.
Have you ever been on a trail in a forest that goes up a steep mountainside. You don’t go directly up, the trail twists and turns so that you can traverse its steep ascent without sliding back down the mountain. The same is true of trails in jungles. They never take you in a straight course toward the waterfall. They route you around dense thickets of trees, ferns and vines; sudden drops into ravines; and waterways too dangerous to cross. Similarly, a wise skier does not ski straight down a steep slope. Sooner, rather than later, his speed will take him into an obstacle that will send him head over heals in a dangerous high-speed tumble that could cause serious injury. Instead, he skis in a zig-zag pattern, making elaborate, artistic looping “Zs” all the way down that steep slope. Thus, he remains in control of his descent and makes it all the way down to the lodge, his final goal. Each zig and zag lead to an interim goal and brought him successfully, ever closer to his final goal. Zigging and Zagging is a law of nature. Whoever has followed game trails knows they don’t go through obstacles, they go around or under them. Who came directly, in a straight course, to this meeting? It works the same for your business, it never runs in a straight line to your entrepreneurial dream goal.
As entrepreneurs, we learn that we first must define our grand idea, write down a business and marketing plan, and set our goals. Then we are told to go after that major goal. So we do–we charge straight at that goal with all the energy and passion we can muster for months on end. We wonder why we never get there. Right now, 9 out of 10 new businesses fail, often within the first year. The rest are gone withing the first five years. What is wrong with this picture? Why are we throwing our time and money at a model that is destined to cause us to fail? My first six businesses failed using the above model. Along the way I’ve now had 12 failures and 12 successes. I learned from those failures and success. I learned that we need to have a paradigm shift in our thinking. We need to avoid the business destroying landmines and obstacles in our straight road and instead take planned detours that make sense for our business. We need to zig and zag to our big goal. So, when I built the business, Castle Wave–the business that spawned my book, Bootstrap Business, using the zig-zag principle, we made $1.2 million the first year and $3.9 million the second year. Then I sold it. Since then, I have been successful in four of my next five business endeavors. I then was persuaded to write a book explaining the Zig-Zag Principle so that other entrepreneurs could have the same success.
I have noticed that there are four entrepreneurial groups who have set their big goal and are taking action to achieve their goal.
- The first group is the talkers. At any social gathering you can hear them talking big about their business and their big goal. The problem is… they are all talk… no action. And so they never achieve their goal.
- The second group are also talkers. They charge mightily… directly at their goal. But… long before they get there, they run out of income. Their engine lacks fuel to take them up the hill to the left on their first zig.
- The third group, with their heads bent over their creation, work with a team to develop a competitive product, taking three or more years to perfect it. They look up, ready to market it, only to discover that their product is already obsolete. The market has already moved on to a better technological device in the same niche market.
- The fourth group has learned from the errors of the other three. They take action, carefully watching the marketplace, to quickly develop a pacesetting product in their industry, and get it to market before any of their competitors have even thought of it. They have carefully invested their money (bootstrapping) to produce a sound product, and put together a marketing plan that attracts investors. They now have sufficient fuel to produce, market and successfully sell their product. To do all of this, they had to zig and zag from one interim goal to another, always making sure that they had enough capital to achieve the next goal on their road to the big goal. The road to success is never a straight line.
- Firm Foundations–There are four steps in establishing a firm foundation.
- Assess Your Resources. What resources do I have? You must understand what they are. Make sure you have enough resources to get to the goal. The first two are the most important pieces.
- Mental Capital is the sum of all the understanding and creativity you and those working with you can apply to the business goals. Get really smart or good at something. Become the expert in your niche market–the person everyone else goes to.
- Relationship Capital is the synergistic interactions that build productivity within your organization or between you and your mastermind (mentor) group. Determine the contacts you already have and then go out and network to build more. Follow your existing channels to gain access to those people you need to contact for marketing purposes. Help and contribute to the people around you, serve them.
- Financial Capital is the total assets of you and your partners and financial backers. “Plus” your service. Always give more service than asked to those around you within your business network. Add value to them. Doing so always equates to building your financial capital.
- Set your Beacon in the Fog. Build your “big goal” lighthouse on the mountain so that you can see its beacon from any road you’ve had to zig or zag onto in-order-to move forward toward that beacon. Set a big, hairy, crazy goal.
- Create Emotional Fuel. These should be catalyzing statements that are articulate and crisp in defining your Big Goal. Put them out there where you and others will see them. Those statements should create emotions that cause everyone to desire to join you. For example, John F. Kennedy said, “America needs to set a man on the moon and return him safely to Earth.” The goal was to have America build the best space system in the world. And Bill Gates said, “I would like to see a PC on every business desk and in every home in America.” His goal was to get his Microsoft operating system into every computer that went into every office and home.
- Your Company Values System must be set up when you set up your company. These values create your screen or gate keeper. Every company is going to have a different values system. For instance, a business oriented system may say: Be respectful, Be fair and equitable, Be fiscally responsible, Be dutiful, etc., while a Dance Company might say: Give our customers a delightful experience, Give your best performance every time, Give total effort at every practice, Give a full time commitment to be the best dancer.
- Profitability. Since all businesses have cash flow problems, your first Zig is to drive to profitability. Drive quickly, as fast as possible. Ask yourself, “What is the most direct way to get the cash in the business? What skill or resource do I have to use to get profitable?” Look for even the crazy actions that will get you there.
- Add Resources. This Zag includes getting people resources, outsourcing resources, and process resources. Come up with a step-by-step process to work your plan. Make sure it is consistent and understandable to your people. Teach and train your people. Consistency allows you to get to the next level. Rich was asked how he helps his people stay focused on the goal. He replied, “I use a 5 minute white board exercise. I send the entire team to the white board and have them list everything they need to do that day. Next I ask them to prioritize the most critical ones with the letter A, next with B, and last with C. The C items you are basically saying “No” to. And that is the magical secret. It is true that 20% of any actions you take move 80% of the action. Those 20% items should be your A prioritized actions. Focus on them and get them done first–be internally motivated. Oh, and if someone else’s item being done is critical to you accomplishing an A item, you can change that person’s item to an A item.”
- Scalability is the final Zig. Scaling means to make sure your business doesn’t outgrow your ability to run it. Look for methods to grow your business without having to do it all yourself. Don’t attempt to grow too fast or the scale will outgrow your resources and your ability to run it. If you don’t nail the running of the business first, then scale it, it will end up running and then consuming you. So the key is to work on the business, not in the business. Your business needs to be a replication model that enables you to vacation while the business is still making money.
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