The Only True Test of Any Theory

In business and in the free market, the only test for the validity of an idea or course of action is, “Does it work?”  The only way that you can tell whether or not a theory or principle is true is by testing it in the real world. Does it work? Does it bring about positive results? Does it bring about better results than another other system or theory?

The good news is that in the material world, all results are measurable.  In the business world, all results are measurable in financial terms.  You can tell if something works in reality by simply looking at the numbers. If it is a good and worthwhile idea, it improves the quality of life and well being of people in measurable terms. If it is not a good idea, it decreases the quality of life and well being of people, again in measurable terms.

Results Speak for Themselves

Throughout the world, whenever freedom and the free market have been introduced, especially into previously poor nations, they have achieved results that are often astonishing. Asia is one of the best examples. In 1945, both India and Japan were impoverished nations.

Most of Japan had been bombed to rubble in World War II. India was just emerging from 300 years of British Colonization. It was extremely poor and underdeveloped.

Japan introduced the free market. The great monopolies were broken up, capital poured in, and the free market was encouraged to thrive.

Within three decades, Japan became an ultra modern industrial powerhouse, with its people enjoying some of the highest standards of living in the world.

After World War II, India achieved its independence and immediately introduced a socialist system. From then to now, it has remained poor, corrupt and backward, with hundreds of millions of its citizens existing on subsistence wages.

The free market was soon introduced into Hong Kong, Singapore, Taiwan and Korea. Once it caught on, the economies of these countries boomed. Their living standards rose dramatically.

By 1995, the resource poor island of Singapore surpassed England in annual income per person. Hong Kong became one of the most entrepreneurial and affluent places in the world. Taiwan boomed and flourished, achieving living standards twenty times greater than those of China across the straits.

From 1970 to 2000, a period of 30 years, the average annual income in Korea went from $200 per year to $10,000 per year, an increase of 50 times! The soaring skyscrapers, beautiful hotels, super highways and vast industrial complexes of these countries are tributes to freedom, free markets and free people. These are the kind of results that count

Eternal Vigilance is Necessary

John Stuart Mill once wrote, “The only thing necessary for the triumph of evil is that good men do nothing.”

The forces of compulsion and coercion, the something for nothing people, are always waiting and watching for an opportunity to get back in, no matter how prosperous people become with freedom and free markets. The “Thievery Gene,” activated by the E-Factor and the desire to get something for nothing, infects countless people at a deep level, like a cancer that has gone into remission, always capable of being reactivated and spreading throughout the body.

The Killer Emotions

I mentioned earlier that emotions distort valuations. There are two negative emotions that are used to justify and stimulate the worst qualities of human nature, envy and resentment. Like the thievery gene, the feelings of envy and resentment lurk just under the surface in the minds and hearts of many people.

Shakespeare wrote, “A touch of nature makes the whole world kin.” He said that envy of the successes and accomplishments of others lurks just below the surface in almost every person. It can easily be triggered by an appeal to our sense of vanity. People prefer to believe that the reason that someone else is more successful than they are has nothing to do with their own talents, abilities, attitudes, actions or behaviors. They prefer to believe that people are successful, not because they have worked long and hard to achieve it, but because they have simply been “lucky.”

Democratic senator Richard Gephardt said a couple of years ago, “Those who have been successful at the gaming tables of life must be forced to share their winnings with those who have not done as well.” This is the kind of thinking that dominates much of the policy making in Washington, and in the individual states.

Someone Else Is Always to Blame

Each person has a deep need to rationalize away his own failures and deficiencies. The easiest way to do this is to blame someone else for your problems. Politicians, eager to get votes by appealing to the lowest common denominator of human nature, will eagerly step forward to encourage people to believe that the reason that they are not doing well is because others are doing better.

Of course, this is the same as saying that “The reason that you are sick is because someone else is healthy.” The reason you are doing poorly is because someone else is doing well. The reason that you are unfit or overweight is because others are fit and trim. The argument is absurd, but reason and rationality have no place when it comes to an emotion such as envy, especially when it is combined with resentment.

Please watch the video below on “selfishness”

Theory X versus Theory Y

In the 1960’s, Harvard Psychologist Alex Mackenzie suggested two visions of people in the workplace, each leading to different forms of motivation in organizations. McGregor called these two views of mankind, “Theory X” and “Theory Y.

“Theory X was defined as the idea that employees were basically lazy, and had to be continually motivated to do their jobs by using the “carrot and stick” method of rewards and punishment. McGregor postulated Theory Y, which said that people are basically positive, desire to do a good job and will strive toward excellence in their work if the proper incentives exist.

McGregor divided working conditions into two categories, hygiene needs and motivators. A hygiene need was defined as including things such as a secure work environment, a decent paycheck, pleasant surroundings, and proper work tools. His conclusion was that the presence of these factors did not motivate people to work harder, but if they did not exist, workers would be demotivated, and would not do their best work. McGregor defined a “motivator” as something more. It was a factor such as special attention from the boss, praise and encouragement, opportunities for promotion and advancement, greater responsibility, and recognition by bosses and coworkers. He concluded that by practicing “Theory Y” management, managers could bring the very best out of their people, and achieve the very best and highest quality results.

Theory Z Management

Based on my experience with hundreds of companies, I suggest a third factor, which I call Theory Z. Theory Z says that people are neither good nor bad. They are neither positive nor negative. They are neither motivated nor unmotivated. They are merely expedient. In everything they do, mentally, emotionally and physically, they are subject to the overwhelming force of the E-Factor. According to this assessment, people are lazy, greedy, ambitious, selfish, vain, ignorant and impatient, and they will manifest these qualities in a positive or negative way depending upon the structure of financial and non-financial incentives in the organization.

Money as a Motivator of Behavior

It has been said that, “Money may not the most important thing, but it’s way up there with oxygen.” The fastest and easiest way to get the things you want as quickly as possible is almost always to have enough money to be able to buy them, whatever they cost. For this reason, the desire to acquire money, quickly and easily, and as much as possible, is a major motivator of human behavior. But it is not usually money that people really want. Sometimes I will ask my clients why they want to acquire a lot of money. After thinking about their answer for a couple of minutes, they finally conclude that what they want more than anything else is “freedom.” In reality, they see money as a means to achieving the freedom they really desire. They define freedom as having enough money so they can get everything they want. Having enough money will enable them to be completely free from worry about safety, security, comfort, leisure, love, respect and fulfillment. They see having lots of money as the fastest way to the good life.

Ten Million Dollars

In our Advanced Coaching and Mentoring Program, we do an exercise in Values Clarification. When everyone is seated, we hand out individual checks made out to each person in the amount of $10 million dollars. Of course, the checks are not cashable, but the idea of receiving $10 million dollars cash gives people an opportunity to fantasize about what they really want in their lives.

We then have the participants break into groups, discuss what they would do if they suddenly received $10 million dollars, and then report back to the group. We go around the room and write down their answers on a white board or flip chart.

Here is the most amazing discovery: almost everything that our clients would want to do, have or acquire does not cost any money! When people think of suddenly being financially independent, they immediately think about quality of life issues.

As we go around the room, the answers that come back are: “I would work shorter days and spend more evenings and weekends with my family; I would take a long vacation with my wife; I would join a health club and exercise every day to lose weight and get fit; I would write the book I’ve always wanted to write; I would get more involved with my church or political party; I would take up painting; I would write poetry; I would reorganize my business and my life; etc.”

This is an exercise that you can do, as well. Imagine that you received$10 million dollars cash, today. What would you do differently in your life if you had all the money that you could ever need? You may be surprised at the answers that you come up with.

Please watch this video on “ambition”

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Please watch this video on “greed”

At the same time, everyone is motivated by an insatiable desire to achieve safety, security, comfort, leisure, love, respect and fulfillment, manifested by a never ending drive to acquire money and power. What stops the world from devolving into a war of all against all? The answer is to understand how people go about getting the things they want.

The ABC Formula of Human Behavior

Let us divide the way things are done into three parts. We can call the natural instincts that make people lazy, greedy, ambitious, selfish, vain, ignorant and impatient, which are summarized in the E-Factor, driving people toward a never ending search for something for nothing, as “A.”

We can call the natural needs or desires of all people, for safety, security, comfort, leisure, love, respect and fulfillment, “C.” These two elements are fixed factors, hard-wired into the human psyche, immutable parts of human nature and motivation. The only variable in this equation is, “How does one get from A to C?” We can call this interim step, or means, by the letter “B.” Together, we can construct the ABC Formula of human activity.

The Two Basic Ways to Get What You Want

There are two ways that you can get anything: you can earn it or you can take it. There are two ways that you can get someone else to do something: you can force him to do it with threats of punishment, or you can encourage him to want to do it, with promises of rewards and benefits.

The only way that you can stop many people from engaging in harmful behaviors in the process of getting the things they want the fastest and easiest way possible is by making the cost or punishment for expedient behaviors so high they are afraid to do it. To stop people from acting expediently, from seeking their own best interests in destructive or criminal ways, you must make the restraints and constraints so costly and severe that people are forced to either curb their natural desires, or suppress them for fear of punishment.

Throughout all of history, dictatorships and tyrannies have been based on forcing people not to act expediently, or to act contrary to their natural instincts in satisfying their basic needs.

This trampling of people and repressing of their natural desires has been the primary use of power throughout history, and right up to the present day. Human beings are, generally speaking, neither bad nor evil, they are merely expedient. But when people engage in expedient behaviors which hurt others to get something for little or nothing, and then justify their behaviors, they gradually lose their moral bearings and can become very evil indeed.

The Structure of Incentives

In the ABC Formula of explaining human behavior, both the “A” and the “C” are fixed, immutable factors. The only variable is the “B.” You could call the “B” the “Structure of Incentives.” The structure of incentives determines how a person gets from “A” to “C” the fastest and easiest way possible. Any variation in the structure of incentives will immediately change the behaviors of a certain number of people.

Let us organize the various systems of incentives that are available on a scale of 1-10, from the lowest and least productive system of incentives to the highest. A system rated at 10 would be one where the only way to get anything you want would be to either produce it yourself, or to cooperate with others to get it with and through them. It would be totally voluntary, based on merit and on the perception by each person that he would be better off as a result of working within this system. This is the pure free market system.

At the other end of the scale, a system with a rating of one would be a cultural and economic structure where lying, cheating, deceiving, defrauding, stealing, violence and murder are the fastest and easiest way for people to get the things they want.

In criminal societies or organizations, these are the primary ways of acquiring safety, security, comfort, leisure, love, respect and fulfillment, especially money and power. The individuals who are the most ruthless and unprincipled in the use of violent means to acquire the things they want inevitably rise to the top, crushing all competition or opposition on the way. You see this in third world tyrannies, drug cartels and in the aftermath of riots and wars.

Ordering Societies by the Numbers

All groupings of individuals into tribes, societies and nations can be organized along this scale from 1-10. Peaceful, democratic societies, governed by law, cluster at the top of the scale. Despotic, impoverished societies, ruled by force and tyranny, generally cluster at the bottom.

Societies displaying a mixture of the two extremes are arranged along the middle of the scale. Human nature however is like water. It flows downhill, in and through any crack, crevice or hole that it can find. Human nature instinctively, impulsively, reflexively, drives people to continually strive to get the things they want the fastest and easiest way possible, with little concern for the likely consequences.

As soon as there is any way for people to fulfill their desires other than by working and cooperating voluntarily with others, some people, and then more and more, will find that loophole and take advantage of it.

Click Here to gain access to the rest of my video series about “Something For Nothing.”

Human beings, by nature, are lazy, greedy, ambitious, selfish, impatient, vain, and ignorant. These traits are neither good nor bad by themselves; it is only the way in which we manifest these natural traits that make them positive or negative. These natural traits are the fundamental reasons for why people do what they do.

Watch this video on “Laziness”

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The Greatest Miracle

In reality, the free market is the greatest miracle of social cooperation ever conceived of in human society. Because no one can force anyone else to act contrary to their best interests, everyone must voluntarily cooperate with others if they want to satisfy their own personal needs the fastest and easiest way possible.

In the free market, the best rise to the top. Those who are the most skillful at bringing together and producing products and services that people want and are willing to pay for tend to emerge from the competition and become even more successful satisfying customers in more ways. Since every person who controls money or resources wants to earn the highest and best return on those resources, they naturally gravitate towards those people with a proven ability to put those resources to work in the very best way possible. Everyone benefits.

Specialization Becomes Possible

As products and services become more complex, specialization of labor develops. Instead of having to produce everything he needs by himself, people naturally gravitate toward doing those things for which they have a natural facility, which they can do better, and for which they can earn higher pay and greater rewards.

Competition among individuals and businesses to serve even more customers by giving them more of the things they want faster, better and cheaper, drives innovation.

Competition for the seven common desires forces people to become even more creative in producing even more and better products and services for the market. With no intervention, control or involvement by government or any other organized body, the actions of free people in free markets assures the very best and most efficient allocation of capital, resources and labor in the satisfying of customer wants and needs.

The Entrepreneur Takes the Risk

If the entrepreneur guesses wrong and produces a product or service that he cannot sell at a price that yields a sufficient profit to cover the costs of producing it, the losses fall on the shoulders of the entrepreneur and his investors. If the entrepreneur guesses rightly, and brings a product or service to market that customers want in such quantity that he can make a sufficient profit, with which he can invest and produce even more products and services, everyone benefits.

The opportunity to profit in a free market channels the E-Factor into continually seeking better and faster ways to serve customers. This is why profits are the costs of the future. Where there are profits, there is employment, opportunities and hope for the future. Where there are no profits, jobs disappear, companies shut down, and resources move into the hands of people who can use them better.

The Wealth of Nations became a best seller in the American Colonies in the next few years. The ideas of the free market became the bedrock economic principles upon which the American Republic was founded. They still dominate today, even though they are constantly under attack by people and politicians who either do not understand the miracle of voluntary cooperation in open markets, or deliberately choose to ignore it in the pursuit of power and money.

Dislike of Freedom and Free Markets

Since people are naturally expedient, in that they are lazy, greedy, selfish, ambitious, vain, ignorant and impatient, there are always a substantial number who do not like the idea of being rewarded on the basis of their ability to serve their fellow man in a way that he wants to be served. They detest the idea of the free market. They want rewards without working, rewards that are detached from any merit, or any need to satisfy other people. Being human, they want something for nothing.

It is the duty and responsibility of politicians and policy makers at all levels to disallow any route to financial success except by serving other people in some way. No one should be allowed to benefit except by being voluntarily compensated by those people because they value that service. Allowing people to profit without contributing to the well-being of others is the great dilemma of our day, which I’ll talk about later.

Key Purpose

Key Measure

The key measure of business success is customer satisfaction. Your ability to satisfy your customers to such a degree that they buy from you rather than from someone else, that they buy again, and that they bring their friends is the key determinant of growth and profitability.

Key Requirement

The key requirement for wealth building and business success is for you to add value in some way. All wealth comes from adding value. All business growth and profitability come from adding value. Every day, you must be looking for ways to add more and more value to the customer experience.

Key Focus

The most important person in the business is the customer. You must focus on the customer at all times. Customers are fickle, disloyal, changeable, impatient, and demanding-just like you. Nonetheless, the customer must be the central focus of everything you do in business.

Key Word

In life, work, and business, you will always be rewarded in direct proportion to the value of your contribution to others, as they see it. The focus on outward contribution, to your company, your customers, and your community, is the central requirement for you to become an ever more valuable person, in every area.

Key Question

The most important question you ask, to solve any problem, overcome any obstacle, or achieve any business goal is “How?” Top people always ask the question “How?” and then act on the answers that come to them.

Key Strategy

In a world of rapid change and continuing aggressive competition, you must practice continuous improvement in every area of your business and personal life. As Pat Riley, the basketball coach, said, “If you’re not getting better, you’re getting worse.”

Key Activity

The heartbeat of your business is sales. Dun & Bradstreet analyzed thousands of companies that had gone broke over the years and concluded that the number-one reason for business failure was “low sales.” When they researched further, they found that the number-one reason for business success was “high sales.” And all else was commentary.

Key Number

The most important number in business is cash flow. Cash flow is to the business as blood and oxygen are to the brain. You can have every activity working efficiently in your business, but if your cash flow is cut off for any reason, the business can die, sometimes overnight.

Key Goal

Every business must have a growth plan. Growth must be the goal of all your business activities. You should have a goal to grow 10 percent, 20 percent, or even 30 percent each year. Some companies grow 50 percent and 100 percent per year, and not by accident. The only real growth is profit growth. Profit growth is always measurable in what is called “free cash flow.” This is the actual amount of money that the business throws off each month, each quarter, and each year, above and beyond the total cost and expense of running a business.

Action Exercise

You should have a growth plan for the number of new leads you attract and for the number of new customers you acquire from those leads. You should have a growth plan for sales, revenues, and profitability. If you do not deliberately plan for continuous growth, you will automatically stagnate and begin to fall behind. Growth is not an accident; so you must plan and map out your growth plan if you want your business to see a bright future.

How to unlock your subconscious brakes and move ahead
rapidly in your life

Do you have any ideas or attitudes about yourself and your abilities that may be holding you back from great success and happiness? As it happens, everyone does.

Feeling Inferior

In her wonderful book You Can Heal Your Life, Louise Hay says that each one of us has feelings of inferiority that are manifested in the conclusion that we are not good enough.  We think that we are not as good as other people, and we feel that we are not good enough to acquire and enjoy the things that we want in life.  Very often, we feel that we don’t deserve good things.  Even if we do work hard and achieve some worthwhile objectives, we believe that we are not really entitled to our successes, and we often engage in behaviors that sabotage our successes.

The fact is that you deserve every good thing that you are capable of acquiring as the result of the application of your talents.

Ordinary to Extraordinary

You need to develop your beliefs about yourself to the point where they serve you every day in every way.  Men and women who accomplish extraordinary things are just ordinary people who developed themselves mentally to the point where they were able to overcome the obstacles that stood in their way, and they kept on keeping on until the goal was attained.

The most harmful beliefs that you can have are what we call “self-limiting beliefs.” These are beliefs about yourself, most of which are not true; but they hold you back nonetheless.  Sometimes you, or others, will say that you cannot achieve certain goals because you did not get enough education.

The humorist Josh Billings once said, “It ain’t what a man knows what hurts him.  It’s what a man knows what ain’t true.”  It isn’t the actual truth about yourself and your abilities that hurts you; it’s the things that you consider to be true and that have no basis in truth.

Make a Change

The starting point of changing your beliefs is to get up the courage to question them seriously.  Question your basic premises.  Check your assumptions.  Ask yourself, “What assumptions am I making about myself or my situation that might not be true?”

It’s a fact that we fall in love with our excuses and our negative assumptions.  We fall in love with our reasons for not moving ahead.

The author Richard Bach wrote this beautiful line: “Argue for your limitations, and sure enough, they’re yours.”  Very often, we become the prosecuting attorney in the case against ourselves.  We dispute and argue and attempt to prove to ourselves and others that our limitations are real.  And the less justification these ideas or beliefs have, the more adamant we become in attempting to prove them to others.

Whatever they are, resolve to challenge them. Hold them up to the light. Imagine that you had absolute confidence in yourself in a particular area. Then, act as if it were impossible to fail, and it shall be!

3 Steps to Success

Here are three steps you can take immediately to put these ideas into action.

First, accept that you are as good and as talented in your own way as anyone else you will ever meet. There is nothing you can’t accomplish if you really want it.

Second, challenge a belief or idea about yourself that is holding you back. What if you had extraordinary ability in that area? What difference would that make in your life?

Third, stop making excuses for lack of success. Instead, start making progress. Think and talk about what you want and then get busy making it come true.

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Don’t get caught not listening to your potential customer. This is critical to your sales success.

Paraphrase Your Customer’s Words

The customer is only sure that you have been listening when you paraphrase what they have said and feed it back in your own words. This is where the rubber meets the road in effective listening. This is where you demonstrate in no uncertain terms to the prospect that your listening has been real and sincere. This is where you show the prospect that you were paying complete attention to what he or she was saying. Paraphrasing is how you prove it.

Question For Clarification

When the prospect has finished explaining his or her situation to you, and you have paused, and then questioned for clarification, you paraphrase the prospects primary thoughts and concerns, and feed them back to him or her in your own words.

Use the Right Words

For example, you might say, “Let me make sure I understand exactly what you are saying. It sounds to me like you are concerned about two things more than anything else and that in the past you have had a couple of experiences that have made you very careful in approaching a decision of this kind.”

Feed It Back Accurately

You then go on to feed back to the prospect exactly what he or she has told you, pausing and questioning for clarification as you go, until the customer says words to the effect of, “Yes, that’s it! You’ve got it exactly.”

Earn the Right to Sell

Only when you and the customer completed a thorough “examination” and have mutually agreed on the “diagnosis” you are in a position to begin talking to the customer about your product or service. In general terms, this means that you can not pull out your brochures and price lists and begin telling the customer how your product or service can solve his problems or achieve his goals until about seventy percent of the way through the sales conversation. Until then, you have not yet earned the right. Until then, you don’t even know enough to begin an intelligent presentation without embarrassing yourself.

Be A Good Listener

The more and better you listen, the more and better people will like you, trust you and want to do business with you. The more they will want to get involved with you as a person and the more popular you will be with them. Excellent listeners are welcome everywhere, in every walk of life, and they eventually and ultimately arrive at the top of their fields.

Action Exercises

Here are two things you can do immediately to put these ideas into action.

First: Remember that your first job in the sale is to get the customer to like you and believe that you understand his situation. Paraphrasing is the way you accomplish this.

Second: Be sure that the customer agrees with you completely when you feed back his concerns to him. Only then can you really start selling.

A year later, he came back to take the seminar again. But this time, he was distinctly different. He was calmer and more self-assured. He was still a little shy, but when he shook hands, his grip was firmer, and his eye contact was better. He sat toward the middle of the seminar room, and he interacted quietly with people around him. At the end of the seminar, he told me that he was starting to move up in his sales force and had had his best year ever. He was determined to do even better in the year to come.

About 14 months later, Tim came back to the seminar. This time, he brought five people from his company, all of whom he had convinced to come to the seminar, and he had offered to pay their tuition if they weren’t satisfied. He walked right up to me and shook hands firmly, looking me straight in the eye with a strong, self-confident smile. He asked if I remembered him, and I told him that I remembered him very well. He said that he had brought something that he wanted to show me. He took out of his pocket a letter from the president of a national corporation-one of the biggest companies in the country-personally congratulating him for the outstanding job he had done in sales in his territory in the past year.

It turned out that Tim had gone from number 33 to number one out of 42 salespeople. His income had risen from $26,000 a year to $98,000, and he had increased his sales volume at a faster rate than any other salesperson in the country had. He was still quiet, but he had a wonderful air of power and purposefulness about him. He had taken the steps and paid the price to build himself into a fine young man. He had made the decision to do whatever was necessary to overcome his shyness and to develop the kind of personality that he admired in others. He was, and is, in every sense of the word, a self-made man.

Two Mental Laws

Perhaps the most wonderful result of developing high levels of self-confidence is the positive impact that your personality will have on your relationships. There are two mental laws that are always operating and that determine much of what happens to you in your interactions with people.

Law #1

The first is the law of attraction, which says that you will inevitably attract into your life people who are very much like you.

Law #2

The second law is the law of correspondence, which says that your outer world of relationships will correspond perfectly, like a mirror image, to your inner world of personality and temperament.

In combination, these laws simply say that as you change in a positive direction, you will find yourself surrounded by people who are very much like the new person you are becoming. As you get better, the quality and quantity of your relationships will get better. You will meet nicer, more self-confident, more interesting and enjoyable people. You will find yourself getting along better with members of the opposite sex, including your spouse. You will find yourself doing better at your job, or even in a new job, and getting along better with your boss and your coworkers. Your attitude of confidence and calm assurance will make you more attractive to people. They will want to be around you, to open doors for you, to make opportunities available to you that would not have arisen when you didn’t feel as terrific about yourself as you do now.

Often, people lack self-confidence in their relationships with others because they judge themselves poorly in comparison. Sometimes you become self-conscious of what you are doing and saying, and sometimes you are afraid that people will not like you or accept you the way you want them to. Well, there is an important mindset that you can adopt to improve your ability to get along well with others in a more relaxed and confident fashion.

Practice Detachment

It’s important to remember that no one can affect your thoughts or feelings unless there is something that you want from him, or something that you want him to refrain from doing. As soon as you begin to practice detachment and decide in your own mind that there is nothing that you want or expect from another person, you will find that his ability to shake your self-confidence is greatly reduced. The people who are the most successful in human relationships are those who practice a calm, healthy detachment from others, and although they are friendly and engaged in the conversation, they don’t allow the behaviors of others to determine how they think and feel about themselves.

As you can see, it is our fears and doubts that, more than anything else, undermine our self-esteem and self-confidence and cause us to think in negative terms about ourselves and our possibilities. As Maslow said, we begin to “sell ourselves short” and see all the reasons why something might not be possible for us. We magnify the difficulties and minimize the opportunities. We become preoccupied with the possible losses we might suffer and the possible criticisms we might endure. Our fears and doubts paralyze us, preventing us from acting boldly, lowering our self-confidence and causing us to think and talk in negative terms. In fact, this probably describes the great majority of mankind. Most people are so preoccupied with their fears that they have time for little else, and this preoccupation manifests itself in much of what they say and do.

The only real antidote to doubt and worry and fear and all the other negative emotions that sabotage our self-confidence is action. Your conscious mind can hold only one thought at a time, positive or negative. When you engage in systematic, purposeful action, using and stretching your abilities to the maximum, you cannot help but feel positive and confident about yourself.

Act as though it were impossible to fail. Act as though you already had a high level of self-confidence. And continually ask yourself, “What one great thing would I dare to achieve if I knew I could not fail?” Whatever your answer, you can have it if you can dream it, and if you have the self-confidence to go out and get it.

Most of us are like this for most of our lives. There are many things that we want to be, and have and do, but we hold back. We are unsure because we lack the confidence necessary to step out in faith in the direction of our dreams.

Don’t Underestimate Yourself

Abraham Maslow said that the story of the human race is the story of men and women “selling themselves short.” Alfred Adler, the great psychotherapist, said that men and women have a natural tendency toward feelings of inferiority and inadequacy. Because we lack confidence, we don’t think we have the ability to do the kind of things that others have done, and in many cases, we don’t even try.

Just think: What difference would it make in your life if you had an absolutely unshakable confidence in your ability to achieve anything you really put your mind to? What would you want and wish and hope for? What would you dare to dream if you believed in yourself with such deep conviction that you had no fears of failure whatsoever?

Most people start off with little or no self-confidence, but as a result of their own efforts, they become bold and brave and outgoing. And we’ve discovered that if you do the same things that other self-confident men and women do, you, too, will experience the same feelings and get the same results.

Discover Yourself

The key is to be true to yourself, to be true to the very best that is in you, and to live your life consistent with your highest values and aspirations.

Take some time to think about who you are and what you believe in and what is important to you. Decide that you will never compromise your integrity by trying to be or say or feel something that is not true for you. Have the courage to accept yourself as you really are-not as you might be, or as someone else thinks you should be-and know that, taking everything into consideration, you are a pretty good person.

After all, we all have our own talents, skills and abilities that make us extraordinary. No one, including yourself, has any idea of your capabilities or of what you might ultimately do or become. Perhaps the hardest thing to do in life is to accept how extraordinary you really can be, and then to incorporate this awareness into your attitude and personality.

Know Yourself and Your Potential

In developing unshakable levels of self-confidence, your self-esteem, and self-regard are important starting points, but they are not enough. People have tried positive thinking and wishing and hoping for years, with only mixed results. To develop the deep-down kind of self-confidence that leads to victory, you need positive knowing, not just positive thinking.

Lasting self-confidence really comes from a sense of control. When you feel very much in control of yourself and your life, you feel confident enough to do and say the things that are consistent with your highest values. Psychologists today agree that a feeling of being “out of control” is the primary reason for stress and negativity and for feelings of inferiority and low self-confidence. And the way for you to get a solid sense of control over every part of your life is to set clear goals or objectives, to establish a sense of direction based on purposeful behavior aimed at predetermined ends.

Being true to yourself means knowing exactly what you want and having a plan to achieve it.  Lasting self-confidence comes when you absolutely know that you have the capacity to get from where you are to wherever you want to go.  You are behind the wheel of your life.  You are the architect of your destiny and the master of your fate.

Instead of being preoccupied with the fear of failure and loss, as most people are, you focus on the opportunity and the possible gains of achievement.  With a clearly defined track to run on, you become success-oriented, and you gradually build your confidence up to the stage where there is very little you will not take on.

Positive Thinking vs. Positive Knowing

Another essential way to build your self-confidence, through positive knowing rather than just positive thinking, is to become very good at what you do. The flip side of self-confidence is “self-efficacy,” or the ability to perform effectively in your chosen area.

You can raise your self-confidence instantly by the simple act of committing yourself to becoming excellent in your chosen field. You immediately separate yourself from the average individual who drifts from job to job and accepts mediocrity as the adequate standard.

Please stay tuned to my blog, as I will be posting Forging Your Self-Confidence Part 2 at the end of this week.

Until next time,

Brian Tracy

“Concentrate your strengths against your competitor’s relative weakness.”

—Bruce Henderson

There is a military adage that says, “No strategy ever survives first contact with the enemy.” No business strategy ever survives first contact with the marketplace, as well. It must always be adjusted to deal with the realities of the moment.

You have probably heard it said, “Business is war.” What this means is that there is vigorous and never ending competition to conquer the market, win the customer and achieve the sale. Just as you are eager to succeed by selling your product or service and earn a profit, so is your competitor. He wants your business and, if possible, all of it. To achieve this, your competitor will do or offer almost anything to take your customers away from you.

Know Your Enemy

Here then is a question for you: Who is your competition? Exactly? Your choice of competitor determines almost everything you do in your market, just as the choice of an adversary determines everything a general does in the process of conducting military operations.
Your competitor determines what you offer and where you offer it. Your competitor determines your prices and how you charge. Your competitor determines your levels of profitability and how consistently you earn them. Your competitor determines your rate of growth and your very survival. Everything you do must be done with a view toward your existing or potential competitor, and his or her likely responses to your actions.

Determine Their Buying Motives

Once you have determined why it is that people buy from you, you must then ask and answer, “Why do people buy from my competitors?” What value or benefits are your potential customers convinced that they receive when buying from your competitor rather than from you?
What are your competitor’s key strengths? What are his areas of specialization, differentiation, segmentation, and concentration? What does your competitor have that you don’t have? What does he offer that you don’t offer? What is he doing more of or better than you? What is his unique selling proposition?

Marketing Myopia

Many people dismiss or ignore their major competitors. They criticize or belittle them when their names come up. Often they think and say that customers who prefer competitive offerings are simply ignorant or misled. As a result of this self-inflicted myopia, they fail to observe and learn how to outdo their competitors in tough markets.

One of the most effective business strategies you can implement is to always admire your successful competitors. Never dismiss them out of hand. Study them. Learn from them. Respect what they are doing well, and look for ways to improve upon their best features.

Offset Their Advantages

As you study your competitors, look for ways to offset or neutralize the advantages their customers perceive them to have. What are your competitor’s weaknesses? How can you exploit these weaknesses? What do you do better than they do? In what ways are your products or services superior to their offerings? In what areas do you have a distinct advantage over your competitors? What can you do to offset your competitor’s strengths and maximize your advantages? How can you better position yourself against your competitors in a tough market?

The more time you take to study and understand why and how your competitors are successful in selling to your customers, the more likely it is that you will find an opportunity to take away their market share. As Sun Tzu says in The Art of War, “If you know both yourself and your enemy, you will prevail in a hundred battles.”

You Must Be Clear

The greater clarity you develop, and the more accurate you are, with regard to your competitors and why your potential customers buy from them, the better able you will be to counter them and compete effectively. Rigorous competitive analysis can be a vital key to business success. In its absence, you will always be at a disadvantage.

Analyze Your Competition:

1. Who is your competition for what you sell, with the exact customers you are trying to attract?
2. What would happen if you changed your offerings in such a way that you targeted a different group of customers, one that would be easier to sell to?
3. Why do your potential customers buy from your competitors? What advantages do they perceive?
4. What is your competitor’s unique selling proposition? What special feature or benefit does his product or service have that yours does not?
5. In what ways are you superior to your competitors? What can you offer that they cannot? How can you emphasize this advantage in your sales and marketing efforts?
6. Where is your competitor vulnerable? How could you exploit this to your advantage?
7. How could you alter your marketing strategy in such a way that you could achieve dominance in a particular area, with a specific customer or market segment?