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Monday, April 27, 2009

Wishful thinking and hard numbers

It is good to dream. Often indeed how we perceive and visualize our future predicts it. The stuff of "positive self talk", affirmation and visualization sometimes seems like hocus-pocus, but it works if you believe.

The challenge is being sure your dreams are not converted to short-term wishful thinking. A classic example is hoping to win the lottery or a big casino jackpot this month. The odds and probability are simply stacked against you.

In your business, an example of wishful thinking is when you think you can achieve immediate results, even though your objective early (factual) indicators suggest this is less than likely. For example, you have a monthly sales target, but your inputs of marketing leads and work in progress, based on historical ratios and experience, is not sufficient. Sure, everything might land up perfectly and you might pull the rabbit out of the hat, but how likely is this miracle to happen?

In marketing, as in all our business endeavours, we need to keep our dreams alive but remember the hard numbers count the most in the immediate and near future. Is your ratio between marketing cost and sales realistic and on target? Is your "leads pipeline" indicating sufficient volume to tell you that, down the road (using your normal conversion rates), that you will have enough sales going forward? Are your lead conversion numbers and ratios accurate? Things change. You should periodically review your norms.

Finally, if you have staff and they are giving you updates and reports, are you satisfied you are receiving real information about what they are likely to achieve, or are they transmitting to you their wishful thinking? You need to develop and maintain fast-acting measuring systems to ensure the information you receive is timely and can accurately predict your short-term business results. And when you see something isn't right, you need to take quick action to bring things back in line with reality.

Keep track of your hard numbers, avoiding wishful thinking, and then you can go back to dreaming big dreams, and visualizing your grand visions. If you are firmly grounded in the real world, your big picture dreams can indeed come true. Otherwise, you have a better hope of meaningful accomplishment at the lottery terminal.

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