Yesterdays business icons, todays villain - Jack Welch stint at GE

Nation building via learning and being the best in business

When this post was starting out as a businessman, it was an advice to hold on to somebody as a role model.  And one of my lodis was Jack Welch.  I bought books about GE, Jack Welch.   And the whole world idolized him.  He made GE a mega business

But lately, there are news and allegations that actually destroyed GE.   His moves did not make GE unsustainable And by making 50% of GE more of a finance company via GE Capital GE was exposed to financial and capital market risk that required more than a hundred billion bail out.

Hero or villain?

Value creation and pain removal: the Main Value Proposition of Business model

Nation building via learning and being the best in business

 

THERE ARE ONLY TWO WAYS TO MAKE MONEY  - the crux of all business model.   It is a compnaion post about finding capital first to make money.   Find problems first, find solution and get paid for it.   Leave the input capital first to be truly wealthy.

All the options just like the alphabet exist and all ready there, and can be rearranged in infinite number of ways.   Find the key holes (ther problems) and make keys that can fit and open the doors (solve the problem)

Doctors make a lot of money because they remove pain.  Do do pharma company;   or consultants, or auditors.   

So do lawyers and security agency:   they lessen fear.

Pain removal   

THERE ARE ONLY TWO WAYS TO MAKE MONEY

Add Value.

Subtract Suffering.

Everything Else Is A Variation Of These Two Movements.

If You Increase Someone's Advantage, You Get Paid. If You Remove Someone's Friction, You Get Paid. Markets Do Not Reward Effort. They Reward Impact.

The Objection Appears Quickly. Hasn't Every Valuable Idea Already Been Discovered. Hasn't Every Problem Already Been Solved. That Question Assumes Value Is Invention. It Is Not. Value Is Arrangement.

Mark Twain Said There Is No New Idea. Only Old Ideas Rearranged Into New Combinations. The Pieces Exist. The Pattern Changes. And The Pattern Is What The Market Buys.

Art Is Not Created From Nothing. It Is Collected, Filtered, Combined, And Released With Precision. The Same Is True In Business. You Study What Exists. You Notice What Is Inefficient. You Combine What Others Kept Separate.

Adding Value Often Means Making Something Clearer, Faster, Simpler, Or More Accessible. Subtracting Suffering Often Means Removing A Frustration People Have Learned To Tolerate.

Sometimes A Problem Must Be Made Visible Before It Can Be Solved. Entire Industries Were Built By Naming A Pain People Had Normalized And Then Owning The Relief.

The Game Is Not About Being Original. It Is About Being Effective.

If Money Follows Value And Relief, Then The Real Question Is This: Are You Searching For New Ideas — Or For Unclaimed Friction?

Abandoning the input first mindset to be true entrepreneur start up; provide value/service first

Nation building via learning and being the best in business

We are often living in the mindset  of old businessman - INPUT FIRST.  You need capital to: rent an office, pay employees, etc.   Its an employee mindset.   Poor mindset.  But the businessman in the video a businessman emphasized that you PHP or $ is the last or inconsequential in starting a business.  There are 3 things you must give priority to:

       SERVICE

       SYSTEM

       SCALING UP.

So first find a problem and provide a solution.

Following Vance advice Arthur looked at a specific logistic problem he want to solve.   He emailed 50 logistics company and until he finally got one respondent.  He would be paid $6,000 if he got the solution by Friday.  Then he got his $6,000.   He having now proof, emailed the rest of the 49 who turned him down, and offered $2,000 monthly subscription for using his solution.  He got 3, grossing him $6,000 per month.  He eventually grossed $8,000.

So Vance was right.   

Input paradigm shouldnt exist in the mind of the entrepreneur

My missive to protege on a start up

Nation building via learning and being the best in business

You have at your fingertips two important projects, so huge, affecting the lives of many people.

You have estimated revenues and income equivalent to 40 years of work

1.  You will be mostly on your own to decide the results and your destiny.

2   Two laws:

    Kidlins law -  on problem solving.  Defining and writing down the problem solves

    50% of the probleem.

   Therefore:   clarity is needed and write down your action plans on regular periodic

                      basis

    Walsons law-  intelligence and knowledge precedes alll system and then money

                           follows

3.  Entrepreneurship

     You do not have all resources you need now.   Entrepreneurship comes into

     play

     1.  Act, don't be imprisoned by your past beliefs and past action

     2.  Don't wait for permission.   Act but do this in a concerted collegial fashion

     3.  Zero to One (by Peter Thiel Pay Pal)

         1.  All things come from your thinking

         2.  Entrepreneurs create one from 0

      4.  Your capital (capito - head) is your mind -  the endless source of ideas

           innovation and solution.  Use it constantly

      5.  Be present at all times.  The eye of the master solves many issues

       6.  Courage, audacity determination count

   

Another Ylang ylang center: at Anao Tarlac

Looking forward to the future of business
Just before Bamban (the former domain of Alice Guo)

Savings and frugality are the foundation of capital and money markets

Ateneo Professor on Entrepreneurship

Rizal Philippines
July 23, 2019

There could be no market or capital markets unless there was frugality and savings.  The money that flows in and out of capital and financial markets are results of thrift and savings.   The millenials are less likely to save now.

Good old savings of money makes the world go round...

Save.  Reduce cost and expenses...

How to allocate capital for various products/divisions?

Ateneo Professor on Entrepreneurship

Repost from Globe and Mail |  May 16, 2013

Williams and White Machinery is faced with tough decision on where to allocate capital among its three divisions:   manufacturing shop, equipment, and robotics.  Will it be on robotics  - the future, the least capital intensive of all the businesses?

What are the options?

l.  Hold a strategic review?

2.  Find more capital (VC or loans as usual)

3. Talk to key customers?

Please read and write your comments

A Little Bit of Money

Our generation needs an ENTREPRENEURIAL REVOLUTION.

Much has been said that lack of money is the impediment for many start ups.  Well to a large extent, that is true.  But the real capital is not the not the financial capital.  Capital after all comes from the word capito meaning the head.  The head is the real capital.  Intellectual capital that is.

Quoting from the book of Larry Farrell, The New Entrepreneurial Age, the following is the comparative study of start-ups vs other social costs:

       . start up cost         - $l4,000.00
         year on welfare    -25,000.00
         year in Harvard    -35,000.00
         year in prison       -45,000.00

It is twice as expensive to fund unemployment (a defensive move) than it is to support entrepreneurship or even more if the fund is lent to be paid back.  On this basis, the Obama job bill costing $450 billion, which is mostly welfare bill, does not look very sound.  

How about prosecuting and jailing crooks as a policy?

Historically, it does not cost much to fund winning business venture.  A real estate venture we had started with Pl5,000.00;  most of our big companies started with P312,500.00 paid up capital (Pl.25m subscribed capital stock and P5m authorized capital stock)

Splash started with Pl2,000.00, l/2 of the cash wedding gift received by Dr. Hortaleza and wife; Growers peanut started with P3,000.00 capital (as told by the entrepreneurs themselves in their entrep talk we had in class, similar to the November 8 event.)

In  the US, the following are examples of the start up costs/capital of the ff: businesses:


         Dell Computers    - $1,000.00
         Twitter                  -      0
         Facebook              -      0
         You Tube              -      0
          Google                 -      0
          E bay                    -      0
          DHL                     -      0
          Sony 1945            -     l00.00
          Matshusita l918    -      50.00
          Nike 1964             -  l,000.00
          Apple Computer   -  1,350.00

So you do not need millions to earn thousands;  a little bit of money, plenty of hard work, imagination and heart on fire.