Measuring Success in Business
I had an interesting chat with Todd Habicht of HD Petroleum a little while back. One of the things we touched on is the difficulty of recognizing and celebrating business success when it happens. As Todd says it, “there’s no Stanley Cup [in business].”
Todd’s got a fascinating story, and has accomplished many things in business that most of us would count as successes, and yet he’s got a different measuring stick:
I try to run my life on two questions, and my business principles HFSCMM: have fun, satisfy customers, make money.
So, the two questions that I like to ask myself on almost any decision […] I like to think of them more as filters. And the filter that I first run things through is “at what cost?” And the second one is “and then what?”
So there’re choices that a person has to make. So there’s the capital cost in any business decision. And you have to weigh that out. We’re going to allocate this capital to this thing, meaning we don’t have capital to go to this other thing, so it’s a bit of a prioritizing process. At what cost? And then you’re also going to say, “Well, wait a second. If I do this thing, I’m going to miss my kid’s first birthday.” Oops.
If I am going to miss this thing, I’m going to have to work the next three nights with very little sleep in order to meet this deadline. Those are all costs that you pay. And then, I run it through the second filter, “and then what?” And the thing with “and then what?” is it really doesn’t have an end date on it. And if you run “and then what?” through to its ultimate conclusion, well one day you’re dead. But, not to take this into a dark and morbid place, that’s not really where I run every one. But you start to run it ahead and you go, “Okay, and then what?” Well, can we go on this trip and maybe we get more business. Okay, and then what? Well that’s a good thing. Who-hoo. We have to do this. I’m going to miss my kid’s first birthday. And then what? Oh, you know what? I’m not going to be in the pictures. That’s not going to be a very good thing. My kid, 10 years later, is going to wonder, why wasn’t Dad at the first birthday? You start to reevaluate the “at what cost?” And so the “and then what,” if you run it further ahead, you ultimately get to the point of where some day I’m done in business, and I’m going to retire, hopefully, all being well. And then you’re going to look back and you’re going to go… you’re going to kind of reevaluate some of those decisions that you made and say, “You know what? What a stupid fool I was for valuing this thing higher than the cost that I paid.”
If you’d like to read or listen to my entire 2-hour conversation with Todd, it’s available here.