What is insight? Insight is basically the ability to see and understand beyond the obvious. It relates to the perceptive and discerning ability of a person. But what is the value of insight for an entrepreneur? Do you have insight as an entrepreneur? How often do you ask insightful questions in your enterprise? Many times you the entrepreneur will just see the obvious in your enterprise and assume that everything is proceeding well, yet that may not be the case. As an entrepreneur, you need to be very insightful in your approach to business. You need to go beyond the obvious if you must be successful and build a great enterprise. Let’s consider some examples.
- A trend indicating an increase in sales or revenue performance, while appearing good and normal, may not directly mean an improved performance by your enterprise. It may not even mean better performance by your marketing team and other related marketing efforts. Now, why not? The apparently good performance may simply be a result of general economic boom that positively impacts everybody – hence not a result of specific effort on your part. It could also be inflationary. Are you performing above inflation? It could be industry specific and everybody in the industry is enjoying it. You need to have some insight to look deep into the figures and assess their reality and sustainability over the coming years.
- The procurement and ready availability of certain fixed assets in your enterprise may make you feel good. You can afford to own such assets, can’t you? But have you considered the utilization of these assets? Are they optimally used? Are these assets the most suitable for your nature of operations and size of enterprise? Is your enterprise achieving good return on investment from those assets, compared to similar assets in the industry? Insightful thinking and questions may compel you to dispose some of those assets and you will still find that your operations are running as smoothly as before. Without insight you can even procure assets you don’t need. Have you ever come across the kind of salesmen who can make you buy anything – even those you don’t need?
- How about your efforts to improve workers productivity through various training efforts? Your enterprise may spend significant sums of money training staffs and after such efforts you seem to have improved productivity in the enterprise. You need to be insightful enough to confirm whether that improvement is resulting from the training. Don’t you think so? You may be surprised to find out that recent machinery and equipment improvements, pay rise, better leadership and supervision, improved raw materials etc could be the reason for that apparent improvement. Interesting, isn’t it? Only insight can throw more light here.
- Your managers may tell you, ‘We only have one challenge in this enterprise and once we’re through with it we’re done’; ‘If only sales can improve our profits will improve’; ‘We have no competition because what we have on offer is unique quality and features’; and so on. You require insight as an entrepreneur, to think analytically and find out whether you really have only one problem in your enterprise, for example. Can you even solve that problem without creating another? Will your improved sales automatically translate into improved profits? Does your uniqueness mean you have no competition? How unique are you anyway? How long does it take someone to copy what you are doing? What are the opportunity costs of doing what you are doing as an enterprise?
There are hosts of situations and decision-making points in your enterprise that require insight. If you take things for granted and only look at the surface of issues, you are in for a big surprise. If you have been an entrepreneur for some years I guess you understand what I mean. While big enterprises tend to have executives and consultants with the expertise to address some of these issues, small and medium enterprises may not. This places responsibility on you the entrepreneur. I believe you now appreciate the power of insight in an entrepreneur, don’t you?
The Wise Entrepreneur