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Monday Mornings with Madison

MADISON COMMERCIAL REAL ESTATE SERVICES MADISON COMMERCIAL REAL ESTATE SERVICES
#73

ZERO-BASED THINKING

Why do we make the same mistakes over and over again? Managers and entrepreneurs are prone to repeating mistakes because they approach their decisions with a consistent set of assumptions. Based on those assumptions, they make the same type of decisions, and then — surprise! — get the same type of results. But you can break this pattern if you’re willing to question the assumptions you have about where you are right now.  If you want your business choices to add up, try zero-based thinking.

This is an interesting technique for making difficult decisions that was developed by the noted business coach Brian Tracy. It is a “what if” exercise that encourages people to ask themselves: Knowing what I now know, would I get into this business/job/situation again? With the facts I now have, would I hire this same person? Would I launch this same product or service? Would I approve this marketing plan? When you don’t know how to resolve a difficult decision, use these questions to reframe the issue into a simple black or white answer: yes or no, up or down. And when you've got that answer, it is easier to know what to do next.

We’re often reminded that hindsight is 20/20. In other words, it’s always easier to see what you should have done when you’re looking back at the past. Zero-based thinking allows you to benefit from the clarity of hindsight. When you don’t know how to move forward, ask yourself whether you would choose again to be where you are now. If the answer is Yes, then carry on with your evaluation of the problem and make the relevant changes. But if the answer is No, then the next step should be to get out of this business situation as fast as possible. You want to get back to zero and start afresh. Your difficult decision has now become just a question of when and how.

The power of zero-based thinking is that it lets you evaluate your position as if you were coming at it for the first time, instead of focusing on all the time, money and energy you may have already invested in it. The No answers tend to be fairly clear and strong, and it’s important to take them seriously.  If you ignore a strong No answer, you may end up dealing with another mistake, rather than focusing on the bigger and better opportunities that exist for you.

Let’s look at a few areas where zero-based thinking can be used to improve business decisions:

Business relationships  Knowing what you now know, are there people you would have chosen not to work with? When you look at how your business could be more productive, carefully examine the roles that are played by the people with whom you work.  There may be an employee that, no matter how much coaching you give, simply does not produce at the level you need. Ask yourself the zero-based question: Knowing what you now know, would you hire him or her again? If the answer is a strong No, you may at some point have to make the decision to let them go. This is one of the most painful choices a business person ever has to make, but letting someone move on who isn’t performing is generally better for both them and for your work group in the long run.

Or you may have co-workers, partners or an employer whom you thought would help you grow and develop; perhaps they did for a while but now they may be hampering your efforts. Zero-based thinking can help to free you from your assumptions and expectations so that you can look at your future choices with an open mind. Even if it is uncomfortable to part ways, a strong No suggests that moving on will be well worth the effort. It’s likely that you will look back on your choice as one of the best decisions you ever made.

Products and services If you could start over again, are there any products or services that you would choose not to launch? Large companies frequently analyze their divisions and decide to sell or cut entire lines to save costs and to focus on the more profitable parts of their business. You may find that the 80/20 rule — 80% of profits comes from 20% of a company’s products — is applicable to your own business. Use zero-based thinking to examine the different elements of your business. The more you eliminate from the 80% that is less profitable, the more time you will have to focus on the 20% that really matters.

Marketing  Knowing what you know now, which marketing services would you not initiate if you had the choice to start again? And which ones would you now approve if you could? When it comes to marketing, zero-based thinking should be a simple and clear task. Take a look at every marketing project that you have and get the numbers to see which ones are returning on the investment made.  If the numbers are not working in your favor, either adjust your marketing plan to make it perform better or invest your money on something more profitable.

QUOTE OF THE WEEK
“If what you are doing is not moving you toward your goals, then it’s moving you away from your goals.” 
Brian Tracy

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