Taking Advice in Small Business
Experience is the best teacher, but, in a small business, experience can be expensive. Sometimes it's better to take advice.
As a small business owner, I’m constantly learning: about business, money, people, life… me. Experience may be the best teacher, but she’s also the most demanding. The lessons are sometimes clear, sometimes subtle. I find I really have to pay attention or I miss the point. And it’s often painful learning the same lesson twice.
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Because experience is hard to acquire and untangle (and doesn’t come cheap), I also try to learn from other people’s experiences whenever I can, by considering their advice. I can’t always tell whether advice is valuable when I first hear it. I have to take it, put it into action and see what happens, which carries some risk. But that’s part of taking advice, and the tradeoff, in aggregate, should be worth it. We’re a social species after all. We rely on each other. I don’t know a lot of things, and if the time comes I need to know about one of those things I don’t know about, a knowledgeable person’s advice helps; or I can’t see my current course is headed for a cliff, but some well-placed advice from a friend may start a rethink; or some suggested change from my current course, a change I can’t work out for myself, may lead me to some better off place. So I have to be open to advice and, where the advice seems valuable, be willing to take some risks and try it on. I just have to decide which advice and risks to take.
When considering advice, I ask the following: What kind? What is it saying? Who’s saying it? Will it work? If it involves a change in my conduct, can I stick with it? I have general observations but no simple formula for which advice to take and which to ignore. Business, like life, moves by trial and error. If the list seems fussy, it’s because I prefer it that way. I assume the risk when taking advice. And because I don’t want to blame other people for what happens in my life, I try to be deliberate and careful when I do.
I put advice into three categories: practical, business, and life. Practical advice is know-how. What steps do I have to take to get started with my one person consulting business? Does anyone know how to set up a wireless extender? Recommendations and referrals for suppliers also fall into the practical bin. Do you know a good lawyer? Practical advice is easy to think about. Someone with more knowledge and direct experience in a specific area can help me with my problem in that area. Great. If that person wants to sell me something, not as great. I have to be more careful. An interested opinion is OK as long as the person giving it is also genuinely interested in helping me solve my problem, not just in selling me their solution. Compared to business advice, practical advice is easier to get, easier to vet, easier to follow.
Business advice is levels up from practical know-how. There’s the general kind — what you get from business books or TED talks — and there’s the kind that’s specific to your business. General advice sounds like this nugget from Warren Buffett: “Never stop thinking about how to delight your customer. Not to satisfy your customer, but to delight your customer.” Or this one from Benjamin Franklin: “Remember that Money is of a prolific generating Nature. Money can beget Money, and its Offspring can beget more, and so on.” It’s broad strokes. It reveals principles. The good kind hits hard and gets you thinking about how to apply it in your own situation.
Advice that’s specific to your business is delivered person to person. You’d look for it when you’re thinking through major decisions around your company’s direction, its management, its operations, its projects. Here, you need someone who can help you organize your thinking; someone who can offer an informed perspective on the options you’re considering; maybe suggest other options you haven’t thought about; someone who can be a sounding board; someone who can give you a clear framework to help guide your decision-making step by step. You’d really need this person to have done this before, either having gone through a similar experience themselves with their business or having worked in a professional capacity as a trusted advisor to similar businesses such as your own. If the advice giving becomes an ongoing thing, this person may become a part of your management team.
This is an area where small business owners are woefully underserved. Most don’t get this kind of advice from anyone, outside or inside their business. Management consulting and advisory firms are too expensive. (Plus, they’re not plugged into small business reality.) Owners who’ve successfully navigated similar waters are usually off enjoying the fruits of success. Employees in a small business can’t contribute at this level. (If they could, if they could help untangle complex management problems, why are they working as employees in a small business?) Business coaches are more about self-management than strategic consulting. Business partners are going to be in the same boat doing what you’re doing, rowing instead of steering. (Another not great possibility is every partner has a hand on the steering wheel.) It’s really, really hard to get good business advice when your business is small.
Life advice is roughly experience distilled. It’s the easiest to get. Even when we’re not actively looking for it. It often comes unsolicited as part of our casual, everyday communication. Everyone has something to share — some secret to a good life, or some albatross that leads to a ruined one — and by some hard-wired human drive, when we take stock of our days, we all need to share our conclusions. It can be your dad, your neighbor, your friend from way back, the newest thought leader, or some Greek philosopher long gone from this life. They all want to tell you something. Like I want to tell you something. With so many perspectives and variations, choosing one piece from that massive collection and committing to it becomes the real challenge. We’re forgetful and easily distracted. More on that a bit later.
What is it saying?
I try to think each piece of advice through, because the advice it’s offering is not always obvious. Consider this bit from Ben Franklin’s Advice to a Young Tradesman: “Remember that Six Pounds a Year is but a Groat a Day. For this little Sum (which may be daily wasted either in Time or Expence unperceiv’d) a Man of Credit may on his own Security have the constant Possession and Use of an Hundred Pounds. So much in Stock briskly turn’d by an industrious Man, produces great Advantage.” What’s going on here? The first part says that, with good credit, a man can have access to money cheaply. The second part says that same man, if he’s industrious, can briskly turn that money to produce “great Advantage.” That is, he can generate greater returns on the money he’s borrowed than its cost. This, to me, is a pretty adventurous take on debt from someone (like Franklin) who also insisted on frugality, a concept I associate with living below one’s means. But Franklin, as a businessman, had to get comfortable with debt. He needed money to start and survive in business and he didn’t come from money. The comfort must have come from his industrious nature. He had confidence in himself and his understanding of the world he lived in.
Debt is a scary word for small business owners (and rightfully so). Most, in my experience, resort to it to prop up a business model that isn’t working. Fewer think of it in the terms Franklin advises here: a relatively cheap input (at a 6% annual interest rate in his day) for a skilled and hard working businessman to feed into a business model that is working.
It’s dangerous to follow advice you only part understand. Franklin isn’t just saying money is cheap for people with good credit. He’s saying it’s cheap for people with good credit who are diligent, hard working, and who also know how to use it. Good credit is a factor, but it isn’t the key. Good at business is the key. Take on debt without understanding that distinction and your good credit will be a thing of the past; money will stop being cheap, if it’s available at all.
Who’s saying it?
In last week’s post, I cited Matt Damon’s speech at the end of The Martian. In it, he warns a class of astronauts of the possibility that, at some point during a space mission, everything goes south. At that point, he continues, they can either accept it, it being death, or get to work. “You solve one problem, then you solve the next one. And then the next. And if you solve enough problems, you get to come home.” Home would be Earth, where Damon’s character, astronaut Mark Watney, has returned after spending 564 days on Mars. I would have added miraculously to the returned home part, but the humans in the story, Watney chief among them, are such steady, capable problem solvers that divine intervention is neither needed nor called for. The Mars rescue is an extra credit assignment for these overachievers, tough but not too tough.
So, on the one hand, we have good general advice for anyone running a small business — don’t give up when faced with setbacks, even when they’re severe; focus on the next step, get through it, focus on the next, keep going — and, on the other, we have a superhuman giving it. Because that’s what Watney is. Not only does he keep his mind, body, and soul from breaking, alone on a lifeless rock hundreds of millions of miles from Earth, he believes and accomplishes six impossible things every day to survive and to support his rescue.
Where it isn’t of the practical know-how kind, I do my best to detach advice from the person giving it and deal with it on its own merit. Not that I don’t recognize that someone like Felix Dennis is more qualified to give advice on getting rich than the average someone. I accept the person giving the advice may have used it to achieve success or extraordinary outcomes in their life. But I also suspect that there are some unspoken characteristics of the person or that person’s context that made the advice especially effective in their situation. Or maybe the advice had little to do with the success and was just pumped up after the fact to tell the story. I can’t expect the same outcomes. I have to make the advice work in my context. I don’t want to replicate the advice giver’s life. I have to live mine.
Will it work?
Copywriters are in the business of selling using just words. Most of their work goes into getting prospects to the point of buying. But by the time prospects get there, copywriters know they’ll hesitate. Doubt sets in. Is this really for me? Will it deliver what it promises? One technique copywriters use to get their charges safely across this gap is the rock solid guarantee: “You’ll be satisfied or you’ll get your money back. No questions asked. In fact, I’m so sure that the Mega Life Changing Thing will cure everything that’s wrong with you that, if you’re not satisfied, I’ll personally mail you a check for twice what you’ll be paying today.” There are no guarantees with advice and no undos. There are only risks. It becomes a leap of faith. But you’ll want to take a look before you leap.
The thing to look for, clearly, is evidence the advice works. The closer that evidence resembles your own small business situation, the better. Copywriters know this too; it’s why they use a boatload of testimonials. This goes back to our social nature and how we rely on and learn from other people’s experience. Also, if one of the variables that determines whether the advice is successful or not is the person putting it into action, then you have to make sure the advice is right for you, in the sense that it fits with what you know and who you are. You’re not a finished product, sure, but you’re going to have some anchors and fixed points by now. A new idea or habit can’t waltz in and knock everything about; it has to learn to get along or it won’t be welcome. Finally, if you’re hesitating, you can look for more advice or canvas others in a “What would you do?” exercise. This could lead to a kind of paralysis. But if you’re a certain type, more input or a better sense of alternatives can help. In the end, if you value your agency, you’ll do what you think is best.
Can I stick with it?
It’s not just hard to break out of set ways and take advice, it’s hard to remember the advice and follow through. We’re easily distracted. And sometimes, we’re just not cut out for it. Kris tried to introduce the Profit First approach to a small sample of his clients a few years back. I think one of them adopted it and used it to quickly grow his business and improve its profitability. The rest tried it for a while and fell off. The advice may have been good in general, but not good for them, and they found that out after trying it.
Recently, Darren said something to me when I was (again) lamenting our past mistakes; it was some advice he’d gotten from a friend: “Regret will eat your days.” That registered, the same way Kris’s phrase from a few months back registered (“Hope lies to mortals”). I asked Darren if he can actually live up to that and let things go. He told me he had to watch for those feelings and, when he recognized them, actively work to contain them. So it was a piece of advice that he’s trying to follow, not a piece of advice that he collected and left unused.
Any advice that affects your business affects you, and any advice that affects you affects your business. Change is good. Making a habit of change is not so good. It usually takes time and effort for the positives that come from good advice to kick in. The initial steps are the most uncomfortable. There’s a certain amount of digging in and stick-with-it needed. I find that when I can’t follow through with one commitment I make to myself, I deplete some finite store of confidence I have in me to follow through on personal commitments in general. Knowing this, I tend to be even more conservative in taking advice and putting it into action. The losses take their toll. You have to know yourself and your limits.
I’m going to close this advice on advice post with three bits of life advice that I’ve found useful in the small business context:
Control what you can control. This is lifted from Stoic philosophy. It’s warning against wasting energy on or worrying about things you can’t control. There are a lot of these “out of your control” things in small business, and this way of seeing and being doesn’t come naturally for most, me included. It takes work to apply, but it’s important to make the effort. Worrying about things you can’t control involves far too much stress for far too long, and it robs a person of their sense of agency. The advice is also a warning against neglecting to control the things you can control. For the Stoics, the thing to control is the will — the set of reactions, emotions, and desires. In small business, I view it simply as look after your shop. Be alert, diligent, and industrious like Franklin’s Young Tradesman. Or the rot will set in.
The second is Nick Carraway’s father’s advice from the opening of The Great Gatsby: “Whenever you feel like criticizing any one, just remember that all the people in this world haven’t had the advantages that you’ve had.” For the longest time, I thought the advantages were a privileged upbringing, and the advice is the conventional, genteel warning the well-off give their young when dealing with the less well-off. Then I noticed that Nick’s father included “all the people in this world” and not just some of them. What he’s getting at, I think, is the basic fact that there’s one person and then there’s everyone else. The things going on in the head of one person make up his way of seeing the world, his advantages. No one else has his unique way of seeing. No one else has his advantages. And, as he carries his advantages along with him in his everyday life, he can’t help but think critically of people who don’t share those advantages. Nick’s father is reminding him that all the people in this world live outside of his head. And he has to get outside of it too, outside his unique way of seeing, in order to meet them.
“Do thine own work, and know thyself.” This is a quote attributed to Plato in Montaigne’s third essay from his first book. He writes: “Of which two parts, both the one and the other generally comprehend our whole duty, and do each of them in like manner involve the other.” Some small businesses think they have no issues here. A donut store makes donuts. That’s what it is and that’s what it does. Or is it? What about coffee? A breakfast, lunch, and dinner menu? Small businesses, especially when they’re just starting out, have to wrestle with the “know thyself” and “do thine own work” ideas. Without that positioning and focus (and understanding of a clear role and niche in the ecosystem they inhabit), they risk becoming an eccentric and easily disregarded part of their community, like someone who is time rich and money poor.
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