Life at Evaero is rarely without its challenges. The aerospace and defense industry continues to push companies that machine precision CNC parts to do more for less. As well, there are the daily challenges inherent in running a small privately held American manufacturing company.
I have the distinct privilege of teaching at a university from time to time and while I (mostly) relish the opportunity to work through these challenges at work, I also enjoy sharing these real world experiences with my students. Nothing prepares them for business and life after school better than working through the real problems small business owners face day to day.
A student recently asked me which mathematics courses would be most beneficial to someone wanting to run/start a business. Now, I love mathematics and truly believe anyone can benefit from its practice, but my response was it doesn’t matter which classes she takes as long as she leaves school understanding one key concept:
You cannot reverse the sign of a negative number by multiplying that number with a positive number.
Simple, I know, but trust me when I say there are many who don’t fully understand how this plays out in financial statements. Indeed, whenever I have a conversation with someone trying to erase losses with higher volume I am reminded of Nigel Tufnel in the movie Spinal Tap explaining how his band’s amplifiers go to eleven.
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Why does the desire for increased revenue blind us to the fundamentals? I’d argue a possible answer can be found in The General Theory of Employment, Interest, and Money by John Maynard Keynes:
Worldly wisdom teaches that it is better for reputation to fail conventionally than to succeed unconventionally.
How many business leaders do you meet who, when asked to outline their goals, answer with the following: “I want to grow my sales from X to Y?” Next time you hear this from someone important to you (or your business) do them a favor and ask them why.
There are many good reasons to grow a business but when someone throws out a revenue target, more than anything, they seem guided by convention that solely correlates success with revenue growth. To them, building a better business, life, or society is secondary to revenue because convention says bigger is better.
Unfortunately, I see a lot of this in our industry and the outcome is rarely positive. With little thought given to the reasons for growth, an organization will simply become a larger version of what they once were.
The result? An avalanche of chaos, confusion, unhappiness, and stress that can quickly suck the breath out of you and your business and snuff the lights out.
Want to breathe again? Want to turn the lights back on? In the words of Leonard Cohen:
Ring the bells that still can ring
Forget your perfect offering
There is a crack in everything
That’s how the light get in.
Finding your way can be difficult when you’ve got the knob turned to 11, but saying no to opportunities when the numbers don’t look right is a great way to succeed unconventionally.
A little over a year ago we lost a large amount of work when we declined to match the pricing offered to our customer by another company who had agreed to do the work for 10 percent less. Although nobody likes to lose work, having a detailed understanding of our costs made it a little easier to forget our perfect offering and say no.
And where are things at today? Marcus Aurelius once wrote:
Most of what we say and do is not essential. If you can eliminate it, you’ll have more time and more tranquility.
We have very slowly started to make up for the revenue drop and the last year at Evaero has been more tranquil than I can remember it. There are still plenty of struggles to go around and the work has been hard, but there is more bandwidth to work on things I believe are essential to our organization in the long run.
Until next week, consider reflecting on your goals and ask yourself “why?” If you find you are being moved by convention rather than conviction don’t double down. Instead, consider ringing the bells that still can ring until you find your own path to success and happiness.
In your service…xian