How To Save Your Business From Near Disaster In A Down Market. – With Verne Harnish
on Apr 30, 2009 - 12:56 PM PSTA few lessons from this program
I pulled this clip because after you watch it, when your business runs into trouble, I hope you’ll recall what you learned from this video and use it to get back on your feet and into the ring. In this clip, Verne Harnish opened up his dark days in business, how he snapped back, and how you can too.
About Verne Harnish:
Verne is CEO of Gazelles, Inc., Founder of Entrepreneurs’ Organization, and the author of Mastering the Rockefeller Habits: What You Must Do to Increase the Value of Your Fast Growth Firm. He’s also the author of these business articles, which we talked about in the program.
The excerpt:
I almost lost my company in 2001. Right post 9/11, I lost about $1 million in 8 weeks.
At the time, I went from $1/2 million to $2 million to $4 million. I’m burning cash like mad, because growth typically sucks cash. I came within days of literally losing everything.
I was massively depressed and I didn’t want to get out of bed. And I didn’t want to face the creditors. And I had to let most of my people go. Right around Thanksgiving, in fact. I just thought that this way they would have time off during the holidays. You do weird stuff in your head when this is happening.
I had a mentor who’s still my coach today, Arthur Lipper, who said, “You’ve got to get your butt out of bed.”
The most important thing you have to do whenever you get in trouble–not if, but when–is go out and talk to every customer you can. They’re actually your friends. And you gotta go lay it on the line and say, “What do I need to do?”
They’re going to give you the answer.
So a couple of things about mindset. First, looking at the recession, right now we’re talking about the economy shrinking like 5% or 6%. That still means that the cup is 95% full.
Instead of a $14 trillion economy in the US, it’s $13.8 trillion or something like that. That is a lot of revenue that we can still go after, in terms of piecing together a $5 or $10 or even $100 million dollar business.
So first, someone’s going to get that business, and it might as well be you.
Number 2, and I wish I could take credit for this, but I just heard an amazing speaker in Malaysia, where we just hosted our Growth Summit a couple of weeks ago. George Kohlrieser, who’s one of the leading hostage negotiators, said you have to decide, are you really in this economy playing not to lose? Or are you hear playing to win?
It’s so easy to get that defensive mindset where I just want to protect what I already have, including the things I’m doing that are unprofitable, the customers I’m serving that are wasting a lot of time.
Instead, you’ve got to decide, that this is probably, the single Black Swan moment–if we’re to borrow Nassim Nicholas Taleb’s term–the single moment in history that any of us will experience in our lifetimes, where we have a 6 to 18 month window to just go grab massive amounts of market-share around the planet. While our competitors are weak, while they’re scared and are of a mindset to protect their turf, versus playing to win at this moment.
The full program includes:
- Business lesson from John D Rockefeller
- How to get people to say “yes”
- The mindset that will help you recover from setbacks
- Andrew being excessively nervous about doing a good interview
[Thank you Ryan Martens for inspiring this program!]
Give your feedback:
Do you have any advice for entrepreneurs whose businesses are facing tough times?
Get the FULL program:
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April 30th, 2009 at 9:05 pm
Great interview, thanks Andrew and Verne.
I love hearing tactics that are science based, especially around how the brain works.
The whole idea of verbalizing your business challenges on a daily basis as a way to kick your brain into problem solving mode is great. I suspect women do this more naturally than men?
It reminds me of a similar change that happens in the brain when we fully commit to something. When we just “want” something, the brain spends a lot of time going back and forth thinking about “if” we can actually achieve the goal.
When we commit to something, the brain stops asking “if it's possible” and starts asking “How can we do this”. That's when we start seeing the solutions.
As for the technical hitches, I wouldn't worry about it. They are going to be a regular feature using skype etc for the foreseeable future, so no use letting it stress you.
April 30th, 2009 at 9:13 pm
Phenomenal. This might have been one of the top 2 or 3 of all time. I'd definitely drill deeper on two or three of those topics and get him on camera again in three months.
May 1st, 2009 at 7:31 am
This was definitely a hard-hitting interview. Thanks a lot.
May 1st, 2009 at 11:43 am
Thanks for the interview with Verne Harnish, who was a mentor to me as I studied for an MBA at the Robert H. Smith School of Business at the University of Maryland and chaired the Board of Directors of the Association of Collegiate Entrepreneurs (ACE).
Verne is an amazing entrepreneur, leader, and speaker. As motivated to succeed as anyone I know, I can't imagine him unable to get out of bed as he said!
By the way, Verne is also a talented pianist and magician!
May 1st, 2009 at 12:36 pm
Not that I needed any more motivation but these interviews put me over the top. My amazon order list grew with this one. I totatlly agree..that face to face or video to video is key.
May 1st, 2009 at 4:56 pm
Thanks!
Yeah, Skype has been the best way for me to record these interviews.
May 1st, 2009 at 4:58 pm
I'm so glad you got as much out of this one as I did. Verne was so good to
do this.
May 1st, 2009 at 5:00 pm
He's not the first successful entrepreneur to admit on Mixergy that he
couldn't get out of bed.
I specifically asked him to talk about this because several startup
entrepreneurs have talked to me about the trouble they're having. And every
one of them feels like a failure. I want them to see that it's part of the
job.
Thanks for this comment Phil.
May 1st, 2009 at 5:04 pm
There really is a lot here.
He's a great guy. Not sure if it came across in my interview, but I was
actually nervous about interviewing him.
May 1st, 2009 at 5:06 pm
I'm so grateful to him for being so open. Thanks for the feedback Ted!
May 1st, 2009 at 5:27 pm
I just finished to view this interview and I can say that it is one of the top one i have seen so far on Mixergy. Thanks so much Andrew!
Verne is a very smart cookie! I really like the way he use science (and especially brain science) to make changes/decisions in his business.
I have only one beef with his web site: The home is WAY too busy! It is just overwhelming. I know that he has enough great info to last me the 6 months of reading but in my humble opinion, that's really scary homepage. The design is also a little dated. BUT he making millions of $$ a year and I don't so who am I to judge!
In any event, this is a great interview. Please, please pull up and add to the excerpt all the books and web site the people you interview mention. That will be a great value added to the interview. I know that you do that often. I need to re-listen and stop when Verne talks about a book or a site.
Have a great week-end all.
Mo.
May 1st, 2009 at 5:38 pm
Means so much to me that you thought highly of this interview.
Thanks for the feedback on his homepage. If anyone reading this post wants
to send Verne a mockup of what the page could look like, email me and I'll
introduce you to him.
Having said that, I just finished judging the Technology Council's Awards. I
got to see the financials of about 2 dozen companies. The ones with the
busiest homepages seemed to make the most money.
I'm personally drawn to sites that look more like Twitter.com. But the more
people show me their traffic and revenue numbers, the more I realize that
the design style of the Web 2.0 movement didn't pay enough attention to
revenue.
May 1st, 2009 at 8:16 pm
Congrats for the Technology Council's Awards judging! I checked out the site and WOW the panel was impressive. I am sure you did a great job there (I am jealous, I want your job…ha ha)
In term of homepage, like i said who am I to judge. In case of gazelles, it is clear that Verne is the type of person that TALK to the customer (and just count on web/email) so thay homepage may not be that business critical since probably every person who land there is already sold on the product. Still your observation about a busy homepages making more money is really interesting. What it is your sense about that? Could it be that somehow those businesses are bringing higher value to the customer AND just happen to be more cluttered? I can see that many half baked web 2.0 company could have a great/clear looking homepage but very little to show for in term of value to the customer…
Have a super week-end Andrew.
Mo.
May 2nd, 2009 at 5:05 pm
Really good to hear. Nice punchy questions. Do you have a background in journalism?
May 3rd, 2009 at 12:43 pm
Check this out if you want to know more about andrew
http://www.quicksprout.com/2009/04/08/the-andre...
May 3rd, 2009 at 5:02 pm
Thanks
May 5th, 2009 at 3:21 am
Hi Andrew, yet another great interview. I enjoy listening to the interviews and found that it had as much value as reading “Founders at Work”. May I suggest that you post the “Must Listen” or top 10 most popular posts on the side bar so that all new visitors will get to sink their teeth into the posts straight away instead of having to hunt for them? Furthermore, perhaps you could have a post that outlines or summarises all your previous interviewees's recommended readings/books? Keep up the good work!
May 5th, 2009 at 1:01 pm
Thanks.
I'm working on a new way to show the archives. pallian.com is designing it.
I'd love your feedback after it's up.
May 6th, 2009 at 6:24 pm
Very good interview.
Thanks!
May 6th, 2009 at 6:37 pm
Thanks Joe!
May 10th, 2009 at 4:57 pm
Andrew,
Thank you for asking the Mastermind Group question. It was interesting to get more insight on that.
Could you PUHLEAS help me knock some sense into my business partner? He is so intent on reducing prices. We already cut them by 40% about a month ago, and he still insists on pressing further. Even Seth Godin did a post on his blog about why you shouldnt do that, this week.
May i please have the name of the book mentioned? I couldnt quite catch it.
Thank you.
May 11th, 2009 at 9:53 pm
1. Man, sounds like you and your partner are having a tough time here. Is
there any way to test each of your positions and let the data argue for you?
2. Which book did we mention? You mean Verne's book?
August 5th, 2009 at 4:49 pm
Great interview, thanks Andrew and Verne.
August 10th, 2009 at 5:26 pm
I appreciate it Alex!
November 22nd, 2009 at 4:27 am
Great thank you and inspiring view of entrepreneurship by Verne to close. Definitely one of my favourite interviews on Mixergy.
‘Thank you for what you’re doing (Andrew) […] the entrepreneurs; we are the engines of the global economy. It’s why I do what I do.
[…] There’s never been a single human challenge solved by either big government or big business. It’s always been a lone entrepreneur toiling away in the middle of the night in the basement that has brought the solutions to the table and that’s who you and I support in the market place, so you keep doing what you do.’
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