Archive for the ‘Business’ Category

I can’t hide that I was eager to review The Whuffie Factor by Tara ‘missrogue‘ Hunt since I learned that the book was coming out earlier last year. I found Tara by some links that lead me to her blog and I couldn’t agree more with the ideas she expressed there, they were the validating point for ideas I was beginning to have about  Marketing and Economy.

My Copy of The Whuffie Factor

My Copy of The Whuffie Factor

In a previous post I did a study of Whuffie in a more anthropological and historical way comparing it to the reciprocity used in the Inca Empire. But that post was made from the dots I connected from Tara’s posts and other sources including Cory Doctorow’s book.

Finally a week ago, the book arrived in a amazon.com box and I was very happy to finally read it and maybe even post my own review, which I’m doing right now.

The Whuffie Factor is an amazing book, ok not a very quantitive way to express it, but if you read it you’ll understand the importance of those kind of words in saying what you think about something. Tara proposes the Whuffie theory in the first chapters which is basically how to establish a strategy and a course of action in building relationships with your community (costumers and non-costumers).

In the 1980s Michael Porter wrote the importance of strategy in doing business  and he has been proven right every single day since he published that book, today Tara publishes the importance of Whuffie in building a business and a personal brand from now on, and as Porter’s book this one will also prove to be true in the next century if not longer.

The book is very rich in examples about how to win and make others earn a great deal of Whuffie and it’s also divided in to the 5 key points needed to build Whuffie giving a special highlight to the points where it’s needed. This 300ish page book will be sucked up by your brain in a very few hours of reading it and it will give you an insight in what are the key actions to take in order to build a close relationship with your community. If you already think costumer is the first thing, it will show you how to engage in the conversation and if you’ve been skeptical about embracing social networking tools to leverage communication with your costumers, this book will show why it’s important and also show you a myriad of real cases where applying the 5 Whuffie Principles has led to succesful outcomes.

I could talk more in depth of the book, but my best advice is to read it, because no one can explain Whuffie better than Tara.

Advertisements

I’ve been doing brainstorming sessions every week for the past month to get ideas for a new business. With the Economic Crisis hitting every single country in the world and with the developing of my country in particular I saw an opportunity to build a business that may have the opportunity to survive the crisis and grow as we get out of it.

The importance of creating a new business is far from simple, but they key benefits are easy to see. You’ll provide good jobs to the people that start the business with you, you’ll promote jobs in the industry (suppliers and intermediaries) and finally you’ll create an employment for yourself.

Starting ain’t easy. After thinking and analyzing ideas me and my partners came up with 2 possible ideas considering the amount of capital we have available right now (We have many more ideas that requiere more capital and that we will develop in the future). After getting the idea we decided to do a business plan, basically because we were asked for one original business plan at university as a requierment for graduation. Well it came out that doing a business plan is the best idea we’ve ever had. Putting your ideas on paper and starting to back them up with research is the best way to get to know you and your market. First of all you need to do the old SWOT analysis that is basically looking at the outer variables and inner variables togeter. External analysis gives you Opportunities and Threats and Internal analysis gives you Strengths and Weaknesses. Once you know yourself, your resources and how can you make them work on a given market you need to come up with strategies.

 

Michael Porter came up with a basic theory of strategies that helps a lot, then of course for the specific strategies you need to sit and think again. Coming up with the strategies for a new business it’s a very good thing to do because it makes you think in what will help your business to get costumers, how will you monetize it or create the income cashflows that will serve to keep going and how much service will you put out there.

In an economic downturn you face a market with less cash to spend and therefore and bigger challenge to attract them to use your product, so you need to innovate and the chances are that if you survive a year in an economic downturn with growing sales you can make a succesful business when we get out of it. So I encourage everyone to make a business, but for sure make a business plan so you have some base knowledge to know what to expect and to help you stick with the basic business. Of course,  a business plan can be wrong and it usually will fail to be 100% truthful on what to expect, but it’s a fair approach to what will happen and it is a good approach to a map to guide the development of the business. The other important point you need to cover is the capability of reacting to changes in the market. When you analyze the key factors on the SWOT analysis you come up with key variables you need to monitor and follow closely as you develop your business and if you see that one changes you neeed to be able to react quickly.

So building a business right now it’s not a crazy idea, just make sure to plan and know if you could make it survive a year or to with the cash you have. If you don’t have enough money for a big idea scale it down, but think of a business model that has the potential to be succesful in the whole world with minor tweaks, that may help you make a good business that has the potential to be big in it’s niche or market.