Whether your venture is a new pizza parlor or the hottest new software product, beware: These nine flawed assumptions are toxic.

1. Assuming you know what the customer wants

First and deadliest of all is a founder’s unwavering belief that he or she understands who the customers will be, what they need, and how to sell it to them. Any dispassionate observer would recognize that on Day One, a start-up has no customers, and unless the founder is a true domain expert, he or she can only guess about the customer, problem, and business model. On Day One, a start-up is a faith-based initiative built on guesses. 

To succeed, founders need to turn these guesses into facts as soon as possible by getting out of the building, asking customers if the hypotheses are correct, and quickly changing those that are wrong.

2. The “I know what features to build” flaw

The second flawed assumption is implicitly driven by the first. Founders, presuming they know their customers, assume they know all the features customers need.

These founders specify, design, and build a fully featured product using classic product development methods without ever leaving their building. Yet without direct and continuous customer contact, it’s unknown whether the features will hold any appeal to customers.

3. Focusing on the launch date

Traditionally, engineering, sales, and marketing have all focused on the immovable launch date. Marketing tries to pick an “event” (trade show, conference, blog, etc.) where they can “launch” the product. Executives look at that date and the calendar, working backward to ignite fireworks on the day the product is launched. Neither management nor investors tolerate “wrong turns” that result in delays.

The product launch and first customer ship dates are merely the dates when a product development team thinks the product’s first release is “finished.” It doesn’t mean the company understands its customers or how to market or sell to them, yet in almost every start-up, ready or not, departmental clocks are set irrevocably to “first customer ship.” Even worse, a start-up’s investors are managing their financial expectations by this date as well.

4. Emphasizing execution instead of testing, learning, and iteration

Established companies execute business models where customers, problems, and necessary product features are all knowns; start-ups, on the other hand, need to operate in a “search” mode as they test and prove every one of their initial hypotheses.

They learn from the results of each test, refine the hypothesis, and test again—all in search of a repeatable, scalable, and profitable business model. In practice, start-ups begin with a set of initial guesses, most of which will end up being wrong. Therefore, focusing on execution and delivering a product or service based on those initial, untested hypotheses is a going-out-of-business strategy.

5. Writing a business plan that doesn’t allow for trial and error

Traditional business plans and product development models have one great advantage: They provide boards and founders an unambiguous path with clearly defined milestones the board presumes will be achieved. Financial progress is tracked using metrics like income statement, balance sheet, and cash flow. The problem is, none of these metrics are very useful because they don’t track progress against your start-up’s only goal: to find a repeatable and scalable business model.  

6. Confusing traditional job titles with a startup’s needs

Most startups simply borrow job titles from established companies. But remember, these are jobs in an organization that’s executing a known business model. The term “Sales” at an existing company refers to a team that repeatedly sells a known product to a well-understood group of customers with standard presentations, prices, terms, and conditions. Start-ups by definition have few, if any, of these. In fact, they’re out searching for them!

The demands of customer discovery require people who are comfortable with change, chaos, and learning from failure and are at ease working in risky, unstable situations without a roadmap. 

7. Executing on a sales and marketing plan

Hiring VPs and execs with the right titles but the wrong skills leads to further trouble as high-powered sales and marketing people arrive on the payroll to execute the “plan.” Executives and board members accustomed to measurable signs of progress will focus on these execution activities because this is what they know how to do (and what they believe they were hired to do). Of course, in established companies with known customers and markets, this focus makes sense.

And even in some start-ups in “existing markets,” where customers and markets are known, it might work. But in a majority of startups, measuring progress against a product launch or revenue plan is simply false progress, since it transpires in a vacuum absent real customer feedback and rife with assumptions that might be wrong.

8. Prematurely scaling your company based on a presumption of success

The business plan, its revenue forecast, and the product introduction model assume that every step a start-up takes proceeds flawlessly and smoothly to the next.

The model leaves little room for error, learning, iteration, or customer feedback.

Even the most experienced executives are pressured to hire and staff per the plan regardless of progress. This leads to the next startup disaster: premature scaling. 

9. Management by crisis, which leads to a death spiral

The consequences of most start-up mistakes begin to show by the time of first customer ship, when sales aren’t happening according to “the plan.” Shortly thereafter, the sales VP is probably terminated as part of the “solution.”

A new sales VP is hired and quickly concludes that the company just didn’t understand its customers or how to sell them. Since the new sales VP was hired to “fix” sales, the marketing department must now respond to a sales manager who believes that whatever was created earlier in the company was wrong. (After all, it got the old VP fired, right?)

Here’s the real problem: No business plan survives first contact with customers. The assumptions in a business plan are simply a series of untested  hypotheses. When real results come in, the smart startups pivot or change their business model based on the results. It’s not a crisis, it’s part of the road to success.

Many people who start businesses have little or no experience and just jump in. The author has created the following list of the biggest rookie mistakes:

1. Keeping your rent as low as possible. The key to business is to keep expenses low, right? Wrong. Sometimes it is worth paying more rent if it will generate more customers, if it gives a better image and inspires confidence, if it helps attract the right employees or if it makes it easier to deal with suppliers. In retail, this one mistake can determine success or failure.
2. Hiring someone you know and trust. Competence is more important. While hiring friends and relatives can work, it severely limits the pool from which you choose, leaving out people who could be much more qualified. Friends and relatives can also carry baggage. They can also be very hard to manage, which leads to my ultimate advice: if you can’t fire ‘em, don’t hire ‘em.
3. Buying used equipment to keep expenses down. This, too, works sometimes, but it is often shortsighted. For example, buying a used truck with 100,000 miles on it will guarantee that you will spend valuable time and money fixing the truck when it should be out taking care of customers. Can you really afford downtime with any machine?
4. Keeping your prices “reasonable.” How about picking a price that will allow you to make money? Many entrepreneurs underprice their products or services in an attempt to attract business. They either have no understanding of their costs, or they are too busy to think about them. At some point, they have to hire an employee, and that low price will leave no profit after the employee is paid. It may even cause a loss. This starts a very bad chain reaction of cash flow problems, profit problems and stress. Perhaps the biggest mistake is thinking that these problems can be solved by attracting more business.
5. Saving money on professional advice. There is nothing more expensive than a cheap lawyer or accountant. Good lawyers and accountants make good livings, just like anyone else who is good at a job. You don’t get what you don’t pay for — in this case professional, intelligent advice. And here is the worst part. Most lawyers and accountants are not qualified to be business consultants. For that matter, many business consultants are not qualified to be business consultants. Join a business group, talk to successful entrepreneurs, and get referrals from people who know what they are talking about. How do you know if they know what they are talking about? No one said this was going to be easy.
6. Considering borrowed money a last resort. Maybe it should be, but maybe not. Sometimes it is better to borrow money to do things right than to just do them wrong. Borrowing money is not necessarily stupid, irresponsible, or reckless. But it could be. Knowing the difference is, well, the difference.
7. Picking a bank that knows you and that you have a relationship with. Again, it can work. But it can also be naive. Some banks are known for lending to small businesses. Other banks are not. First, find a competent, experienced accountant. Then, ask him or her to assist you in finding a bank. Good accountants should know from their experiences with other clients which banks are in the game. Ask other entrepreneurs who they bank with. In Chicago, there are probably only 10 banks that are really interested in servicing small businesses (that means lending money). And here is the big tip. The people writing the ads for the banks are not the ones giving the loans. You might consider it false advertising. Yes, they do want your business account — they love the noninterest-bearing balances you deliver. But that doesn’t mean they want to lend you money. If you get in a bind, the difference between having the right bank and the wrong bank can be the difference between success and failure.
8. Thinking you have your advertising figured out. It is very important to know whether your advertising is working — and good luck with that! You certainly need to try to figure out whether your advertising is working, but this can be very difficult. Why? Because even if you are trying to track your results, it’s easy to get bad information: Your advertising may be reinforcing the behavior of existing customers. People may tell you they were just driving by when in reality they were influenced by your radio ad. Many times even your customers don’t know what got them in the door. My advice: Accept that it’s impossible to know everything you’d like to know, but don’t stop trying.
9. Treating your employees fairly. Well, yes, absolutely: do treat them fairly. But what is fair? Is it fair to fire someone after two months because you realize you made a hiring mistake? Or are you supposed to give it everything you’ve got, including four more painful months of hope and delusion, while your customers, your bank account, other employees and even the failing employee pay the price? I have probably hired close to 1,000 people over the last 34 years. I have never succeeded in saving, rehabilitating or dramatically changing the behavior of a bad hire. It might not be the employee’s fault; frequently it isn’t. It could just be the dreaded bad fit. It might even be the boss’s fault, but unless you are going to fire yourself, it is what it is. The rookie mistake is to let the situation go on too long. Often people who are not rookies — just bad managers — make the same mistake.
10. Falling blindly in love with your product or service. Fall in love, certainly. But a wonderful product or service won’t make up for bad decisions and deficiencies in marketing, management or finance. Being a successful entrepreneur means being a competent entrepreneur, in addition to being the best baker, computer programmer, picture framer, hairstylist or whatever it is you are.

The following article was originally published on CNN Money.

Whether it’s trying to be great at everything or giving great service away for free, there are plenty of ways in which the best intentions spell business failure.

The world is desperate for good service. Companies that get service right – see Southwest and Zappos – are rewarded with profitable growth and devoted customers. And companies that get it wrong are relentlessly punished. Bank of America’s persistent presence at the very bottom of the rankings for customer satisfaction is one such example.

There are powerful incentives to serve customers well, so why is service excellence still so rare?

Here’s part of the problem: good intentions. It turns out a central barrier to service is not backward thinking and callous management. More often than not, it’s the very human desire to want to do the right thing. BofA’s biggest problem may be that it’s trying not to disappoint anyone right now.

The bank’s not alone. When it comes to service, below are three good intentions with consistently bad outcomes:

1. Trying to be great at everything

Great service providers tend to over-deliver on the things their customers value most, and under-deliver on the things they value least. Patients at the Mayo Clinic can get same-day appointments, but in exchange for that exceptional access, they must give up control over which physician they see. It’s a deal that anyone with an urgent, complex medical issue – Mayo’s sweet spot – is more than happy to make.

These kinds of strategic tradeoffs are built into great service models, and no one apologizes for them. Southwest Airlines (LUV) shamelessly refuses to feed you a meal and transfer your bags, because that’s precisely what allows them to deliver cheap, frequent flights – the things their customers really want.

If Southwest tried to be great at everything, if it tried to be the low-price airline with a tricked-out, high-touch cabin experience that flew anywhere in the world multiple times a day, the model wouldn’t work. The company would end up losing money while being mediocre at everything, which describes the trajectory of most of the major airlines.

Bank of America now seems to be pushing itself on every aspect of its retail offering, with predictably disappointing results. It’s trying to win on cost, convenience, product scope and friendly service, a strategy that’s captured in its epic name: a bank for all of America can’t let anyone down, on anything.

Rather than designing a service model – or multiple service models (see the distinct strategies of Toyota (TM) and Lexus) – that are optimized for key service attributes, Bank of America (BAC) is going for it on all dimensions, hitting it out of the park on none. It’s not the lowest-cost, most convenient or friendliest place to deposit your money. The bank is disappointing all of us in different ways, without the strategic freedom to make anyone truly happy.

What do your own customers value most? What would they give up if they could reliably get those things? Answering these questions is often the first step towards exceptional service.

2. Getting your employees to work harder

When things go wrong, lack of effort is an easy target. Many think service should improve with a little more commitment, usually from your direct reports.. But this argument obscures the fact that you may be systematically setting your employees up to fail.

Call centers are the classic, absurd example. Typical call center employees are asked to watch up to eight screens at once, while fielding questions from callers all over the world on a complex mix of products. Many service reps are timed on call length and instructed not to escalate calls, even though they lack the power or information to solve callers’ problems. Trying harder in this environment isn’t going to do much good – there are serious barriers to employee performance.

What’s the alternative? Design a management system that allows everyone to excel casually. Zappos sees its service reps as company ambassadors on the front lines, building customer relationships. Employees have the tools and authority to take care of customers, 24-hours-a-day, and they’re encouraged to stay on the phone for as long as it takes. Extended call times have even become a badge of honor for service teams.

Our advice to any company suffering from service angst: stop telling your employees to give 110%. Instead, take a hard look at whether you’re setting them up to make your customers miserable.

3. Giving service away

Generosity is at the core of great relationships, and customer relationships are no exception. Create tremendous value for the people who pay you, and then capture some of that value for yourself. Those are the generous economics behind successful service companies.

But unconditional love doesn’t work. You must get something in return for your kindness, or you won’t be around for long. Take Celebrity Cruises. In an increasingly competitive market, Celebrity added 150 new ways of “delighting” its customers. The initiative produced flutes of free champagne, sunset yoga, poolside sorbet, sushi bars, and pizza-on-demand.

Here’s the problem: no one would pay extra for it. The dynamics of the cruise industry made a price hike impossible, and so this short-lived initiative turned into gratuitous service, service nice-to-haves donated to customers with little chance of recovering the costs.

The U.S. Post Office delivers gratuitous service when it blankets the country with low-volume Saturday delivery. Sure, we all like the option, but most of us are unwilling to pay more than the price of a stamp for it. It’s the postal version of free champagne.

Our message, simply, is that service must be funded. New fees and price increases are just one approach – often the least creative – and many markets won’t tolerate them.

Having trouble getting paid for service? Make sure you’re creating real value for your customers. And then try to capture a fraction of it.

Every day, we work with leaders whose hearts and minds are in the right place, but their numbers aren’t. Their problem isn’t a lack of commitment to customers. Rather, it’s an attachment to a worldview that assumes that good intentions are enough to succeed. Not only are they not enough, but they are also sometimes the very things standing in your way.

The following article was published on Mashable.com.

Using social media for your non-profit is a popular way to share your organization’s vision, garner support, fundraise and get volunteers. However, there’s more to it than simply having a Facebook, Twitter, Google+ page, or using some of the many platforms out there. Below you will find a few tips that will help amplify your cause online.

1. Focus
2. Enlist Allies
3. Make a Loop
4. Let Funds Flow Naturally

Click here to read the full article.

The following article was published on Mashable.com.

Below you will find some tips on how to optimize your website on your own.

1. Keep Content Fresh

Give current and potential customers a reason to revisit your website. Think about the websites you visit regularly and what attracts you to them. How can you tweak those attractive elements to be more appropriate for your website and your industry? Start by integrating your blog, Twitter stream, Facebook profile, and other feeds that will automatically update your website when you post content elsewhere.

Publishing white papers, podcasts, videos and other content related to business trends can help establish you as a thought leader in your industry. Encourage visitors (read: make it easy for them) to comment on your content, and start building relationships with current and potential clients to spur engagement. In this new era, it’s all about providing your users with relevant information. Doing so will help drive new and continued traffic to your website.

2. Integrate With Social Media

Engaging users and providing relevant information via social media channels is an important factor in driving traffic to your website. The more your content is shared via social media, the better your website will rank in search engines, and the more referrals you will receive.

The ultimate goal is to build relationships with your site visitors, thus creating long-term customers and brand advocates. So you need to make it as easy as possible for visitors to find and share your content and refer your services to others. Include social media toolbars on your homepage so visitors can easily find all of your profiles. Add sharing buttons to content and to your website, and encourage people to use them. Share your content on social profiles and content aggregators such as Slideshare, and do your best to bring the conversation to your website.

3. Make Ecommerce Easy

The massive amount of information on the Internet has shortened our attention spans and made it easier than ever to ”shop around” for lower cost competitors. Because of this, you need to make it as easy as possible for visitors to purchase what they want, when they want.

It is extremely important to evaluate all possible “purchase scenarios,” meaning the different routes a visitor could take in order to complete a purchase. For example, a visitor coming in through a paid search advertisement may land on a different page than a visitor who was referred from a Facebook link. Making it as easy as possible for these visitors to start and complete the purchase process will have a positive effect on your conversion rate.

Popular ecommerce companies like PayPal and Google Checkout provide free JavaScript and HTML widgets that you can add to your website. After evaluating all of the purchase scenarios, determine where to add these widgets to make it easy and timely for visitors to complete a purchase.

4. Use SEO to its Full Potential

Search engine optimization (SEO) is a huge topic, far too vast and complex to address succinctly. That said, I can recommend three relatively straightforward steps that will likely increase your website’s search engine rankings, and thus make it easier for people to find your business.

• Identify your keywords. Start by building a list of the keywords that you think potential customers will use in searches to find your business. Once you have your list, use a keyword tool like Google AdWords to determine the frequency that those keywords are used and to find other related keywords. With this information, you’ll be able to quickly identify the most important keywords for your business.
• Use your keywords in your website. For each page on your website, figure out which keywords you want to target, then use those keywords in both the page content and the meta-data (the title, description and keywords of the page, which search engines use to determine what the page is about). Then, create links on other pages of your site to this targeted page, using the selected key words in the link title.
• External link building. When other websites link to your site, it indicates to search engines that the content on your site has value, and that boosts your SEO. For that reason, external link building is perhaps the most important aspect of SEO – but it can also be the most difficult, because you have limited control. It’s best to focus on the things that are in your control, such as your Facebook and Google+ pages, Twitter feed, blog, and Yellow Pages listings. Be sure to link to your website from all of these channels.

SEO is an ongoing process, so it’s essential that you monitor your keywords, stay on top of Internet trends, and adapt your strategy accordingly.

Tackling these four activities might not be quick or easy, but once you begin updating your content more frequently, making ecommerce simple and easy for visitors and utilizing social media and SEO to their full potentials, you’ll be well on your way to improved lead generation and more visitor conversions.

When optimizing your own websites, what have you found to be the most important area of focus? Leave your thoughts in the comments section.

While some are still trying to figure out how to use Pinterest, a few companies have found some creative ways.  Kotex, Peugeot, Guess, Proctor & Gamble and British Midland International have developed marketing campaigns using Pinterest while some other companies have found ways to engage their employees.

Over the past few months, several colleges and universities have begun to take advantage of the opportunity on Pinterest.  Duke University, Savannah College of Art and Design, and Texas A&M University are just a few.  Professors at the University of Minnesota and Minnesota State University use Pinterest in the classroom to inspire students, increase student participation and help them tell stories.

Check out the infographic below to learn more about the users.

Owner and product development scientist, Michael Lloyd, was looking for a versatile label design that would combine the southern sentiments of his sauces with the health-conscious taste sensibilities of higher-end food markets. Furthermore, the NumNum Sauce aesthetic needed to distinguish itself among its competition on market shelves and appeal to non-Southern consumers.

Our solution was to mix a clean and structured layout with a bold typeface and punchy colors. In an effort to appeal to two specific consumer markets, we created both white labels – think Whole Foods – and black labels – think Dean and Deluca – for each flavor. Featured here are the Mild, Hot, Mustard and Mustard Spice labels.

As taste-testers of NumNum Sauce, we can confidently say that the labels are as “numnum” as the product.