The upcoming 2012 Presidential race is full of some real characters. The old timers in Washington sit back and laugh it up a bit just until the newbies learn they can’t fix the US Government. Sure, some will try but there are important lessons to be learned here--actually I found nine!
Our Government, Our Friend
Small business owners, especially those new in the entrepreneurial world, can learn some valuable lessons by watching the failures and successes coming out of Washington. In recent years, I sadly can think of more failures than successes, but if you’re a small business owner, why not reap the rewards on what your government has already tested. It could help—or hurt if you’re not careful.
1. Cash Flow and Cash Management
Let’s face it, Washington has a problem with cash flow. Now that the debt ceiling vote is over and a top super committee has until Thanksgiving to figure out what to cut, it doesn’t take a lot of smarts to figure out the government has been way overspending. That means, they are out of cash.
I know there’s the old joke about the expensive toilet seats and why in the heck they need the special government seal on every single folder or memo pad is beyond me, but cash is king to the entrepreneur. If you treat yours much like our government treats theirs, you won’t have any either.
Lesson to be learned here? Watch your cash like a hawk. Don’t overspend and cut expenses where and when you can. Most importantly, take the time to review your cash flow statement every year or even sooner and make adjustments where needed. You may actually find you’ve underestimated your expenses and wouldn’t that be awesome!
2. Keep Your Enemies Close
The war between the Republicans and Democrats is fiercer than ever these days. In fact, they are so set apart, reaching a decision on anything it is always a melodrama. And, even if this or that bill is signed into law, it doesn’t seem to matter. Take it to the Supreme Court, we will—yes siree! You can’t make people buy healthcare! We’ll fight it! There seems to be no bipartisanship today and no one’s reaching over the aisle, as they say. In fact, some of the antics out of Washington are disastrous.
Lesson to be learned here? You need to know what your competitor is doing, smile and play nice but remember, he’s your competitor so while you’re smiling don’t reveal too much about what your business plans are—he’ll steal them! On the other side of this coin, do learn as much about your competitor as you can.
3. The Housing Crisis
I guess you can’t really blame Washington entirely for the housing crisis. Wall Street and financial institutions had a hand in this debacle, but again the small business owner can benefit from this catastrophe.
In Arizona, homeowners walked away from their homes or simply let homes fall into foreclosure. Housing values plummeted and so many loans were offered, there are some real concerns about who actually signed all those loan papers. Again, sorry, business owner, this is a bad lesson.
Lesson to be learned here? Don’t sign up for something too good to be true, including business loans, unless you have researched the bank or lender thoroughly. Ask questions such as will my loan be sold to another lender and will my interest rate ever rise? Is there a balloon on my business loan? Don’t let the housing crisis mirror your business borrowing practices.
4. Watch Your Payables and Receivables
There is a really scary website, US Debt Clock. I actually got dizzy watching the U.S. debt rise instantly (in real time) and it even shows debt per taxpayer! Visit it if you dare. In any event, the country is in debt big time—over $14 trillion.
Why can’t the government collect on any loaned debt? For sure, they can’t pay any other country for loans or investments made on our soil.
Lesson to be learned here: Pay attention to what vendors you owe and what receivables you have coming in. Set some best practices on paying vendors and collecting on your A/R accounts or you’ll be looking for cash. As we know (I swear this is so important)—cash is king!
5. Yes We Can!
Well maybe and maybe not. President Barack Obama founded his campaign on this slogan and promptly changed the auto industry (hurt it really), mandated a healthcare plan and then stomped on Wall Street big time.
I call this putting too many things on your plate at one time and no business owner does well if they’re going in too many directions. I mean the President was so busy and wanted to please everyone but no one can do that. Obama even had a beer on the White House lawn with a cop and a man falsely arrested by that cop. I bet the beer was way warm. with the President’s busy schedule and all.
Lesson to be learned here? Brand your business before you start taking it in new directions. Make a name for yourself and allow customers to like you and your product or service before you determine it’s time to expand.
6. Hello From Hollywood
This is going way back, but in 1981 when Ronald Reagan became our 40th President, he did seem to bring America back together again. People seemed happy, and the American Flag and what our country represented were important from sea to shining sea.
The small business owner can learn from Reagan (Democrats too). He was optimistic and engaged his audience.
Lesson to be learned here? Think of your employees as your audience and engage them. Use voice of the employee surveys. Renew and rejuvenate your staff and your optimism will result in increased productivity. Maybe your business will be sort of like the “happiest place on earth." Thanks Mr. Disney!
7. What Benefits to Cut?
Ugh, this is another bad one for Washington. Too many of our politicians want to cut government-funded programs, unemployment benefits and OMG, Medicare and Social Security may be in trouble. What will Grandma do? Heck, what will you do when retirement comes? And what about your employees?
Lesson to be learned here? Don’t cut employee benefits unless you have to and if you must, make sure you inform your employees or try to find ways to offer a menu of benefits both you as the employer and your employees can afford.
8. Pardon the Turkey
Yes this is a ridiculous tradition but it’s been a White House tradition for decades—but was it really? Presidents since Truman in 1947 received turkeys from the National Federation of Turkeys (yep that’s a real place) and no President officially pardoned the turkey until George H.W. Bush in 1989. Actually most presidents ate the birds, but JFK simply said, “We’ll keep it." What happened to the bird after that is unknown to me.
Business owners do need traditions and that means offering up employee incentives and rewards on a regular basis and staying on top of them.
Lesson to be learned here? Don’t say you’ll start an employee reward program and then skip it. Your staff will not “pardon" you!
9. Customer Service
Ever call a government agency? It’s tough to get the person you want. If you call the Internal Revenue Service, these customer service people hide behind their I.D. number and forget the first names! “Thank you for calling the IRS, my I.D. number is 55555, this is Mr. Davis." No "how can I help," just who you reached and an I.D. number. I don’t even want to talk about other government agencies---this post would become too long to read.
Lesson to be learned here? Your customers have to be important because in today’s economy, consumers are choosing where to spend their money and on what, based on how they are treated. Brush up on customer service skills or invest in customer relationship management (CRM) software.
Fly Your Flag High
There are many lessons the small business owner can learn from the ups and downs we’ve seen come out of Washington. The most important lessons of all, however, may be to really know your business, engage your employees and watch that cash.
The small entrepreneur is what built America and for goodness sakes, I wish Washington would just finally admit it already. Sure big corporations ate up some of those smaller companies but it all started out with small business ideas and owners much like you and me.
Bill Gates and Paul Allen started with an idea and Microsoft was born. Small ideas often become the best sellers on the market and if you offer excellent customer service and schmooze your customers you too can be profitable.
What business lessons have you learned from the success or failures of our beloved U.S. Government? I’d love to hear them—actually, I’m begging for some more ideas, folks!