Choosing Success When Others Fail
“The energy of the mind is the essence of life.” – Aristotle
A few years ago I read a fascinating book entitled “Great By Choice” written by John Collins. With over 20 researchers and studies spanning 9 years, Collins looked at why some companies (and leaders) succeed in difficult times, while others simply fail. One fascinating study finding was that “the best leaders were not more risk taking, more visionary, more creative than the comparisons; they were more disciplined, more empirical, and more paranoid.”
I certainly can attest to the importance of being disciplined when it comes to business. After being in real estate for 40 years, and watching the market ebb and flow countless times, I have found that a few things have helped me to build a successful business and wanted to share them with you. What is interesting is that several of these characteristics are mentioned in this book:
1. Paranoia will NOT destroy you. I think that a bit of healthy fear is not as ominous as some proclaim. As many of you already know, I am constantly encouraging people to live BELOW their means in order to be better prepared should something we cannot control takes place – such as a job loss, illness, death, etc. “Great By Choice” refers to this characteristic as having “self-imposed constraints”. A lot of younger Realtors ask me why I still get up early every day and work out regularly. My reasoning is that if I take care of my body, it will take care of me during times of stress and illness. I must confess that in my early years, this was not the case and is a lesson that I have learned as I age.
2. Track your business/life goals. I am constantly tracking where my business comes from, and setting goals on a weekly, monthly and yearly basis – not only for my business, but also in my own life. It is much easier to achieve a goal when you take the time to set it. “Great By Choice” refers to this factor as having “clear performance markers”. For me, it can be more difficult to set personal goals than professional ones, so I have really made a firm commitment to learning to play my guitar better and taking the time to practice, etc. Many of us will find it easier to track our goals in our personal life compared to our professional life, but getting into the mindset of setting goals is the most important thing you can do.
3. Luck is not a strategy. This is a common misconception in real estate. I was recently speaking with a client of mine and they were about the same age as myself. We were discussing retirement and interests and the person told me that they wish they could retire but that their pension portfolio was cut in half during the Stock Market Crash a number of years ago. They commented to me that I was “lucky” that I owned some real estate instead of a lot of stocks. I found this to be a fascinating comment and really spent some time thinking about my luck compared to this person. I realized that having a sound knowledge in what you are investing in (whether it be in business or in life, or even your partner) can be a critical marker in your ultimate success. Back in 2006, I actually got out of the stock market and purchased some investment properties, figuring that if anything should happen in the economy (as it seemed that everything was “too rosy” to be true), I could at least have control over my investments and know that they were tangible. I still recall several real estate agents laughing at me when I began cautioning clients to no longer finance their lifestyles from the current values of their homes, and I think that this “paranoia” enabled me to recognize a threat to the market and take steps to protect myself. I also have suffered great financial loss when I was younger and bought a company (not real estate related) and did not invest in what I knew. I learned the hard way when I had to sell all of my real estate to cover off this loss in my mid 20’s!
“Great By Choice” offers some insight into how some high-profile companies have succeeded while others have faded away. An interesting study compared Microsoft to Apple during the mid 1980’s and early 1990’s. Bill Gates is known to be a constant worrier and has a fearful nature. From June 17 to June 20, 1991, Bill Gates saw his personal fortune drop an astounding $300 million as Microsoft stock dropped 11% following a newspaper article that published a memo written by Gates himself, expressing concern about competition, customer support issues and proclaimed that “our nightmare…is a reality”. Those closest to Gates recognized that this was his modus operandi and that he was constantly worrying about the small details of his business. These investors recognized the concerns as being issues that Gates identified as wanting to IMPROVE upon, rather than thinking that his company was failing. One year later, Gates was interviewed about the memo, now known as “Nightmare Memo” and his comment was “If I really believed this stuff about our invincibility,” he said, “I suppose I would take more vacations.”
Let’s compare this to Apple, who was being run by John Sculley (not by Steve Jobs – who interestingly, shared a similar “fearful” mindset as Bill Gates). In 1988, Apple had a spectacular year and stock values continued to increase almost overnight. How did Sculley react to this success? Was there any concern with the company “growing too fast too soon”? Apparently not, as Sculley took a 9 week sabbatical soon after. The very next year, Apple’s value began to drop and its return on equity fell from nearly 40% in 1988 to 13% in 1994, turning negative by 1996. It was not until Steve Jobs returned to Apple, that things began to turn around for this company. I really think that it is possible to learn basic principles that will provide us with some insulation from the harsh reality of today’s economy. One important step is to evaluate your economic portfolio and investments. Do you know the current value of your home or property (and not based on BC Assessment)? Do you know what the current interest rate is on your mortgage right now? How many years do you have until your property is paid off? Having a sound knowledge of where you are at will go a long way to helping you and your family determine where you are GOING financially in 2020.
Feel free to contact our McCullough Marketing Team anytime to discuss your real estate questions at 250-751-1223 or email firstname.lastname@example.org. We want to be there for you BEFORE you need us. The success we enjoy is only because of the confidence people like you have shown in Myles and me. We would like to take a moment and thank each of you for your support, business and referrals. We feel as if we form special friendships with our clients, and we truly appreciate your trust. I hope you had wonderful Halloween! Visit our website at www.mmshomes.com