Google’s CEO will not join other public companies and project their income every quarter. Here’s why: (“quarterly guidance” below is Wall St parlance for projecting next quarter’s income.)
“We don’t want it to get in the way of running the business,” Schmidt said. “If we started giving quarterly guidance, all of a sudden the whole company would start focusing on the quarter rather than trying to change the world.”
Schmidt knows that once he says “we’re on target to earn X next quarter” two bad things happen: 1)The entire company’s focus is on hitting those numbers, including doing things like pre-selling stuff, or making deep discounts, (things that you cannot sustain in a healthy business) and 2) the observers (analysts for them, neighbors and friends for you) use the actual results to judge you and your business.
In case your knee jerk reaction is, “Well of course, Google has so much money they can afford not to focus on the money,” know this: When Google first started, they were like a church. Doing something good that people wanted (good search) and not charging for it (they still don’t charge you for using search).
They didn’t even have ads for their first year.
“Google looked a lot like a charity in the beginning. They didn’t have ads for over a year. At year 1, Google was indistinguishable from a nonprofit. If a nonprofit or government organization had started a project to index the web, Google at year 1 is the limit of what they’d have produced.” See here.
They continue to focus on providing useful information we never had access to before. Free. To us, the users.
Think we could create such a business model?
P.S. Register for the Customer Savvy Program starting this weekend here. (Auditor spots only left, sorry. At least they’re only $97.) Get your free “If My Product’s So Great, How Come I Can’t Sell It?” eBook with sign-up until Monday night, August 18.
Along a different but parrallel pathway of thinking, 90 days is too short of a time period to expect results from a business enterprise. One of the reasons American firms are getting our arses kicked in international competition is that they make decisions based on stockholders desires for 90 day gains. Short term thinking is anethema to success, the more short term results are demanded the less long term success there will be. You can pretty much count on it. It’s ok to expect and demand that your business will produce a profit long term, it’s not good strategy to focus on the money, and it’s not ok to demand it show up in the short run. Immature thinking.
I think we can create such a business model. It is up to each individual to set the example.
One of my own downfalls is getting focused on whatever promotion the company is currently running. Whenever I get focused on a company promotion, I take my focus off helping my prospects. The result is I never get the bonus.
I was trying to make the next pin level with one company I was with and I kept falling short. When I finally gave up trying to get to the next pin level and just focused on helping my prospects, that’s when I made the next pin level.
I’m with a new company now, and the first thing I did is get focused on the promotion that started the day after I joined. I’ve not been able to set an appointment since. I think my prospects can hear in my voice that I’m in it for myself, not them. I need to get refocused and be in it for them, not me.
I definitely agree short-term thinking will get you nowhere. I believe that’s why the U.S. is in trouble, particularly with our energy resources. I once heard a Native American tribal leader speak about making decisions based on the 7th generation to come. My husband and I have been talking to our 13-year old grandson this week about following his passion, being an entrepeneur, giving to the community, instead of always me, me me. Not sure if any of it got through. Any suggestions?
Joe Washburn has it exactly right as to what the proper attitude is. And, what a big part of the problem is. It never ceases to amaze me that companies push short term promotions and agendas that destroy the very thing they should be trying to create, service focused reps. They often turn good folks off because we know that the short term, monthly promo stuff is creating focus 180 degrees from where it should be: on helping the potential customer with THEIR needs.
I agree. I thought that my upline telling us to get the dollar signs out of your eyes was simply a ploy to aid our denial of money we were losing. Also, by focusing on giving the best service, by feeling the satisfaction of that, you always win and so do they. If not a sale, perhaps referrals. If not referrals, you’ve made a difference in someone’s life just by taking the time to listen. Mostly, you’ve shown them that your business is a nice business to be in. Someday, they might want what you have.