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Business

How to Uncover Hidden Goldmines and Lurking Monsters

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This post is part of a series called Strategic Planning for Your Microbusiness.
How to Set Goals With No Room For Excuses
What You Can Learn From Spying on the Competition

The key to the success of any business is the ability to notice and seize opportunities. How can you learn to notice opportunity? The simplest way of doing so is to ask the right questions.

Where others see only an empty field, successful business leaders run a quick test, and find there's a vein of gold in the rock beneath the ground. They've stumbled on a hidden gold mine. But it wasn't all luck. They had an inkling of where to look.

Asking good questions allows you to think about your business from a range of perspectives. When you put yourself in a different pair of shoes, you see your business from a new vantage point, and you notice things you miss in the day-to-day running of your company.

Good questions not only open your eyes to opportunity. They also help you gain a realistic understanding of your business. They help you see what's going well, and what needs fixing. They prepare you for monsters and threats lurking around the next corner. They help you understand what you're good at, and where you need to improve.

Asking good questions helps you develop a solid business plan, that's agile enough to pursue opportunity, and sturdy enough to withstand potential threats to your business.

In this tutorial, I show you two different tools that can help you ask better questions. In outlining the tools, I'll give you some basic questions to get you started. However, the real power of these tools is in helping you to ask better questions about your business. By enabling you to see your business in a new light, these tools will help you create the questions you need to put your business on a firm foundation.

Tutorial Assets

To complete this tutorial, you will need:

  • A business, or a business idea, which is the point you start from.
  • Access to the Internet and a library, so you can research answers to the questions you ask.
  • A Mastermind Group to discuss your questions with, or at least a group of friends you can bounce your business ideas off.

1. Red Pill or Blue Pill?

Red pill or blue pill? Do I really need to ask? The fact that you're reading this shows that you care about truth and reality, even if they're painful. You're a red pill person, so you're willing to confront the truth about your business, even if it hurts. In the end, it will be better for you and your business.

Note: If you'd prefer to take the blue pill of comforting illusion, there's no need to read on.

So, how can you take the red pill of reality? With a tool called the SWOT Matrix. It can also be called a SWOT Analysis, but I think Matrix is cooler, because it reminds me of a late 20th century Sci-Fi movie.

To run your business through the SWOT Matrix, you need to take a look at it from four different points of view.

Step 1 (Optional): Download the SWOT Matrix

We've created a SWOT Matrix you can use as you go through the following steps. Pick up your copy here.

Step 2: Assess Your Strengths

A SWOT Matrix starts by looking at the strengths of your business.

Strengths are aspects of your business that give you an advantage over other businesses. They're what's good about your business.

Strengths are internal to your business. They refer to what's going on inside your company that makes you better than your competitors. If you've got control over it, or you can change it, it's a strength. To take just a few example questions that can help you discover your strengths:

  • What skills does your workforce have?
  • What makes your business better than others?
  • What do you do well?
  • What do others say you do well?
  • How is your marketing and brand image?
  • How are your finances?
  • How quickly can you adapt to changes?
  • What do you do to keep costs down?

You're looking for everything that's good about your business.

Step 2: Look Out for Opportunities

The next step in creating a SWOT Matrix is to notice the opportunities that are out there for your business. Opportunities are things going on in the outside world that, if you notice them and take advantage of them, could help to boost your bottom line.

Unlike your business strengths, which ultimately you have control over, opportunities are out of your jurisdiction. All you can control is how much you look out for opportunities, and how you react when you see them coming.

Questions that can help you uncover opportunities include:

  • What products in your niche are on trend right now, or are expected to be on trend in a year's time?
  • How are the needs of your customers and prospects changing?
  • What new technologies are being developed that could help your business?
  • Are there any untapped markets out there for your products?

Step 3: Be Honest About Your Weaknesses

Like your strengths, your weaknesses are internal to your business. They're aspects of your business that put you at a disadvantage compared to other businesses in your niche.

Honesty can hurt. Noticing your weaknesses is the hardest part of swallowing the red pill. Being honest about what's not so great in your business isn't always the easiest thing to do. But only by noticing your weaknesses can you begin to tackle them.

Questions to help you notice your weaknesses include:

  • What do your competitors do better than you?
  • What skills or experience is lacking in your team?
  • What are your finances like?
  • How is your marketing and brand image?
  • What could you do better?
  • Where could you find efficiencies in your business model?
  • How good are you at sticking to your business plans?

Step 4: Open Your Eyes to Lurking Threats

Threats, like opportunities, are factors outside your control that could have a negative impact on your business.

As a business owner, it can be tempting to bury your head in the sand and hope everything will be okay. That's not a healthy approach. It's far better to anticipate threats, so you can make contingency plans if those lurking monsters decide to make your business their victim.

To look out for threats, the following questions can be helpful:

  • Which of your products might go off-trend in the near future?
  • Are there any changes to the law being planned that could impact your business?
  • How are customer expectations changing?
  • Are there any new competitors on the horizon, who could take some of your market share?
  • What else is happening that could damage your business or profit margins?

Step 5: Ask Your Own Questions

As I mentioned previously, the questions I've provided in each section of the SWOT analysis are examples of what you can ask. They're not a definitive set of questions to uncover all the strengths and weaknesses within your business, and all the opportunities and threats outside your business.

Use the questions I've provided as a starting point by all means. But more important is to use each part of the matrix as a set of tinted glasses through which to view your businesses.

With your Strength glasses on, look for all your strengths. With your Weakness glasses on, notice the weaknesses. And so on...

2. Get Your Thinking Cap On

The SWOT Matrix isn't the only tool you can use to look at your business from different points of view. An alternative tool that you may find more fun is the Six Thinking Hats, invented by creativity expert Edward de Bono.

The thinking hats come in six different colors. As you wear each imaginary hat, you look at your business from a new perspective.

Step 1: White Hat

With the white hat on, you're looking at the facts of your business. With your white hat on, you collect raw data, such as your sales figures, without doing any analysis.

If you want to combine a SWOT Matrix with Thinking Caps, then you can do the SWOT analysis with the white cap on.

Step 2: Red Hat

Next, put on your red hat, which represents emotion. How do you feel about what you discovered while wearing the white hat? What's your gut reaction?

Step 3: Black Hat

The black hat is about cold, hard logic. Wearing this hat, you ask what would be the most rational response to what you discovered while wearing the white hat? If you look at your business while wearing the black hat, what do you see?

Step 4: Yellow Hat

Yellow is the color of happiness, and wearing your yellow hat, you become an optimist. Based on what you found while wearing the yellow hat, what's the best possible outcome? What's the most optimistic way of looking at your business?

Step 5: Green Hat

Wearing the green hat you get to ask lots of questions. What do you need to find out more about before you make a final decision? What questions do you need to ask of your business? Take any questions you come up with back to the white hat for investigation.

Step 6: Blue Hat

You may go through a number of different cycles of wearing the different colored hats. You only put on the blue hat when you're ready to draw conclusions. With the blue hat on, you pull together everything you've learned to create an overall picture of how your business is doing.

3. What to Do Once You've SWOT-ted Up

As you begin to probe your business from these different angles, you'll get a realistic picture of where your business is at, and any issues you need to address. You've uncovered what you're good at and can build upon, and what you need to improve.

What you've discovered through your SWOT Matrix and Thinking Caps can feed back into your business goals.

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