October 17, 2007

Growing Your Business: Don't Fight the Tide

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It's amazing to me how many people look at the facts - then chose to ignore them. Frequently, people will see a trend right in front of them. They're sharp enough to spot the trend, yet they believe that they can fight it and swim upstream to accomplish their objectives.

True - there's a chance that if you fight hard enough, you just might manage to swim upstream or reverse the tide or otherwise accomplish your objectives by taking the road less traveled. But why fight a trend if embracing it will get you to the same place without having to take the long way around?

I was recently chatting with a banker friend of mine who told me that he's having a hard time getting a promotion and a raise. Another friend, also a banker, clearly recognizes what the trend is in banking: the way to get a promotion and a raise is to move to another bank. People in the banking business say that "you work for an industry, not for a bank," meaning that people in banking change jobs. And the reason they change jobs is because people frequently can't get the raises or promotions that they want from the institutions where they work.

Part of the reason for this is that banks keep careful track of how much revenue each person produces. Even though it seems that one should be able to get a promotion or a raise based on the amount of revenue that one has generated for the institution, in truth, revenue generation generally has nothing to do with one's success in moving up the corporate ladder. Why? Even though an employee has generated a lot of dollars, those dollars have already been generated — whether the employee stays at the bank or not. If the employee leaves the bank, the bank keeps the production of revenue that the employee has created, and the bank can probably hire someone else to manage it for much less than if they'd given the original employee a promotion or a raise.

So what does the savvy employee in this situation do? He or she goes to a new employer where his or her efforts will be appreciated and rewarded financially. The new employer looks at your resume and accomplishments and is willing to pay more for what you've accomplished for someone else. Ironically, the employer for whom you've already accomplished those things would have a hard time justifying your value on a going-forward basis.

My banker friend who recognized this trend managed to change banks and get a substantial promotion and a substantial raise. He is now much more appreciated and better taken care of by the new institution than if he'd stayed in his original position.

Unfortunately, my other banker friend is still trying to change bank policy and get them to acknowledge his value. He's fighting an uphill battle that his peers recognize will be won by making a job change - not by changing the long-standing practices of the industry.

So, as you are working hard every day to build your company, or as you're building your career, be careful that you don't fight the tide too much. Sometimes swimming with the tide could be the smartest way to go. When you spot a trend, you need to determine whether the best alternative is to create a strategy that's based on the rules of engagement in the industry in which you operate - or if you should undertake the daunting task of trying to change the industry.

About Joel G. Block

Well known in the business community, Joel Block is a best selling author, speaker, and business strategist. Frequently a principal in his transactions, Joel has raised tens of millions of equity dollars for his ventures, which have included real estate syndications and privately held businesses.

Joel’s career is highlighted by the launch of a financial publishing company which he grew nationwide and later sold to the Los Angeles Times. More recently, Joel works with scientists, engineers, technologists and others to help them optimize their entrepreneurial opportunities. Would you like to get a private phone consultation with Joel? Visit www.joelblock.com/capital for details.

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