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Numerous would be entreprenuerus often begin their journey with a moment of inspiration that they believe is their ticket to financial success. The problem is that too often the train never leaves the track.
Meaning, that great idea never manifests and therefore it only remains a seed of thought in their mind. The tragedy becomes the fact that having failed to materialize it provides no substantial usefullness to anyone. The failure of the great idea is usually attributed to lack of time to focus on the idea or insufficient resources. While these are valid reasons for the failure of an idea the actual problem extends beyond that. Inspiration like a train must have a track to run on.
To begin with, it is important to note the fact that the “Aha” or “Eureka” moment is a right brain activity that left unattended and without direction will self destruct. What do I mean? Well let’s just say you have a really terrific invention idea that you believe will revolutionize the world. Being idealisitic and positive thinking you pull 50% of the equity out of your home and figure you will design, manufacture, and sell it yourself. If you don’t own a home perhaps you borrow the money from a supportive group of family and friends to establish your start up capital. Either way you are ready to fully invest in the process and let nothing stand in your way. You have had the foresight to contact your local Invention service company to discuss their marketing and patent packages. Moving forward with this creative and entreprenurial endeavor sounds like a good idea at the time but does it make good busines sense? Meaning, have you weighed the cost and fully understood the risks? Or are you simply relying on what you think you know to be true about the product and or service? If we are honest with ourselves we will admit that if an idea comes from us we tend to be less critical of it prefering to bathe in the inspirational lather that we’ve created.
Beyond the right brain, inspiration, their exist a logical left brain that calculates and analyzes numbers, remember that side? Most creative people, including myself, truly detest anything that is solely numerical. I remember asking in high-school math, “Hey where are the pictures in this book?” Many of you probably wondered the same thing as you flipped through what seemed like a catalog of numbers. As matter of fact sometimes even today, if I look at numbers too long then my mind goes numb, opting instead to simply daydream about something abstract like past Seinfeld Episodes.
What is wrong with a guy or gal putting money into a witty invention or revolutionary business idea? Nothing, as long as there is sufficient data to justify the creation and distribution of such a product or service. And how will you identify the need without analyzing relevant data and statistics? Let me be completely straightforward with you and inform you that you can’t. Data and statistics are what run most successful Fortune 500 companies and even flourishing small to mid-sized businesses. I often hear people say, “You mean people are not just going to go out and buy my product or request my service once I create and market it?” Uhhh…nice try buddy but no. As a matter of fact most people purchase products based on percieved need and not some abstract “good feeling” about the product. This is where statistics and vital data comes in. Companies like Anheuser Busch depend on data from Information Resource Inc (IRI) or some other “data mining” company to determine purchasing behavior across a full range of products. So I am here to encourage you not to be any different, do your homework. Many times you will hear me quote statistics from the U.S. Census Bureau or another reputable data based source, for that very reason. If a company the size of Anheuser Busch, who currently dominates their core market, views data collection and analysis as critical to their on-going success then shouldn’t we?
Activity: Just to begin the process, I want to encourage you to take a look at the U.S. Census Bureau website at http://www.census.gov . So that you know I practice what I preach I completed this exercise myself. To begin with I located a 2006 Business Patterns report. In this report, there is a numerical breakdown of data that is based on a series of categories. These categories are key components in revealing the wellness of a specific industry. Categories include, NAICS (North American Industry Classification System), Number of establishments, employee count, First quarter payroll, and annual payroll. Now hear why a report like that could be important to you.
- If you were looking at a specific field that you wanted to get into then even if a job title did not sound familiar you could look at the NAICS code and determine the appropriate industry.
- Maybe you identified a desireable industry but thought that at some point you might relocate from your present demographic location. So you want to see how many opportunities there are to work within that industry throughout the United States. As a cautionary note you probably want to cross-reference this data with a more comprehensive report that is generated from a city/state organization such as your local chamber of commerce. This way you can take the broad understanding that you have detailing the number of establishments throughout the United States and narrow it down to particular areas of interest. For example if you want to get into the entertainment industry then Alaska or Wisconsin does not necessarily have it’s fair share of entertainment companies, simply because there is a large number reported.
- First quarter payroll or annual payroll will let you know how much money is being generated (or at least paid out) in a particular industry. This way you can determine if the industry would be able to pay you an appropriate salary.
Hopefully this short exercise has reinforced the need to reassess how we view statistics. Statistics are more than mere numbers. There is a vital picture that is waiting to be revealed but it takes patience and digging through numbers. Ah yes and what about the dark room, that my friend would be your mind. Once the data begins to take visual form within your mind then you are that much brighter and your day’s of statistical blindness are quickly fadding away.
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