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Competing to Grow, Not to Win (How to Deal with Burnout)
For many entrepreneurs, the natural response to a challenge is double the effort — many business owners are now wearing multiple hats and…
Burnout is more common than ever before. Here, I share some ideas on how you can manage it.
For many entrepreneurs, the natural response to a challenge is double the effort — many business owners are now wearing multiple hats and working more than ever.
But for many, even if they’ve doubled up on efforts and investments, the results are still bad. It’s nowhere near what they had before.
This leads to frustration and burnout.
I myself am having a rather difficult time — I decided to keep my business growth goals for 2020 despite the situation and I just set myself up for some horrible burnout. I have a pretty good diet and I work out 6x per week, but I’m mentally tired. Before this week, I wasn’t sure why.
One thing that I’ve had to mentally agree with is the idea that certain problems can’t be immediately solved just with “hard work” and “smart strategies”. I actually felt that I worked really hard, did it very efficiently (I block & track every minute of my time), did the best possible strategies with the resources available, and the results still aren’t there. I’ve come to accept that there are 2 other variables at play: time and market conditions. Unfortunately, with the new situation, market conditions have changed and we’re in for a long ride.
What drives many business owners (or at least owners like me) are concrete outcomes and the feeling that you’re directly or indirectly responsible for every bit of it. Every sales milestone or award that you get is a manifestation of the strategies you’ve made, the relationships you’ve built, your discipline to execute, or your ability to influence.
The new normal gives us less power to drive these outcomes, and what has worked before is not giving us the same outcomes as we had before.
It shouldn’t be a surprise then that entrepreneurs are the highest-risk group when it comes to burnout.
The solution, I’ve found, is that you should ironically neglect business growth goals and instead you should focus more on organizational and personal growth.
I’ll touch on that a bit, but I want to make sure that you’re in a good position to focus on that first before talking about it…
But First, Protect your Business Fundamentals
This section acts as a disclaimer. If you are in a situation where you have less than 3–6 months of operational expenses in the bank and less than 18 months of cash runway, then you need to cut your losses and generate sales as much as you can to put yourself above water. If you don’t know what these two terms mean:
3 months of operational expenses in the bank: assuming no revenue, can you pay your staff and rent for 3 months straight?
Runway: it’s calculated via (cash in the bank / loss every month). The quotient of this should be equal or more than 18 months.
I won’t go deep into defensive strategies for businesses, as I’ve covered it in Points 1–3 in this article: https://medium.com/@kennyfrc/driving-growth-as-an-sme-during-turbulent-times-20760c9bbd52
Once you have established your business fundamentals, the next step is to not do more of it, as it will lead you to a downward spiral of burnout and potentially relationship problems. This article aims to help you manage it. Let’s move on…
Let’s Understand Burnout
For us to be on the same page, let’s cover off how psychologists define burnout.
It defined as the mismatch between your results and your efforts.
In other words, if you doubled the effort, and if results were still half or worse than it was once before, then you’re going to be mentally burnt out and frustrated.
Many Type A or ambitious people crave the fulfillment of achieving something difficult through the honor of hard work and persistence.
But what if you don’t get it? That’s when the flood of negative emotion starts. “Why not lie low for now until the situation is over?”, you might ask. Some might even contemplate quitting and fall back to the security of real estate or a corporate job.
Do know and understand that this is normal.
But also understand that this is a crucible moment. It is a time that’s meant to test your character, and it’s up to you if you want to pause or to find wisdom from it. It is the time to draw water from stone.
So how do you deal with burnout? Some will suggest meditation, but while helpful, I think at times it’s a band-aid solution and does not solve the root problem which lies at the heart of your beliefs.
Let’s start with “commitment to change”.
Commit to Change, Even if you Disagreed with It
One of the slow, silent killers of many businesses is stubborn management. Being stubborn about a system has worked for years or decades will slowly kill profits until you’re at the stage that you must change.
A situation where you have sufficient reserves and declining revenue is a clear sign that you need to experiment with new strategies.
A good analogy for this is a relative who smokes yet their health is declining. If that person has breathing problems while they walk or work out, that is the perfect time to start changing their habits, and not wait until a mild stroke arrives.
You shouldn’t let time reduce your cash reserves and wait until the moment that you have to spend a lot on an emergency situation. Commit to change now, and you avoid large expenses (either through business pivots or something else) later.
Once you’ve committed to change, what’s next?
Change starts with your Expectations
Another slow, silent killer of many businesses is having the wrong expectations. In contrast to people who cling to tradition, this set of people bet big on 1 idea and have huge expectations for it. This might be true for businesses who are doing well during the lockdown period.
Even when things are going well, it’s still correct to apply good risk management. I’ve been fortunate enough to interact with many businesspeople who are more successful than I am, and a common topic has always been “reducing the risk & downside”.
It does not mean taking no risks at all. It means taking small ones relative to your cash balance (up to 5%-10%). For example, this means taking a $2 billion bet on a new business line if your cash balance is $20 billion, and that means making a $2,000 bet if your bank account is $20,000.
And when you make a bet, your expectation is that you might lose every single penny.
Even if you’re confident, do realize that market volatility is higher than ever, so a good sales month in July for example might not translate to a good month in August. That can be due to government changing their regulations, or the market shrinking, or something else. It is still good practice to bet wisely. Strong businesspeople and entrepreneurs are ultimately excellent risk managers.
Now when you hear that you should “expect to lose money”, this will naturally make an entrepreneur cringe. What’s the point, right? I don’t propose changing only your financial goals; what I mean is that you need to de-prioritize it in favor for something else.
And that “something else” involves changing the way you set goals at its core…
The Right Way to Set Goals When Outcomes Aren’t Going Your Way
In a risk-rich environment like where we are all in today, the best approach is to not set external goals at all. You shouldn’t target a certain revenue or profit target.
What I’ve learned from reading the biographies of high-level entrepreneurs, chess prodigies, golfers, and even legendary pro gamers is that in order for you to win consistently for decades without getting bored or burnt out, is to compete and do things for personal growth and improvement, not to win.
The best don’t have a “passion to win”. Instead, they have the passion to be best in their industry (and that means the best in ability or the best products/services at their price point, not trophies or business size). They understand that the “wins” in their field are an outcome of being the best, and they’re not the best because they win. Most people don’t look to “win” to validate themselves. The mindset is to be the best in skill first, then the world will catch up. Or to use a business example, it’s “to offer the best value to customers possible at your price point, then the market will catch up”.
Here are two quotes from Daigo Umehara that explain it perfectly:
“I’ve learned the value of honest, patient training through the shame of loss. No matter how hard you try, those who train only for a short-term goal without passion cannot hope to consistently take down those who love what they’re doing and have painstakingly explored every facet of the game.”
In business, “short-term goals” mean your financial goals. And “passion” here means how well your systems, technology, and skills serve customers. Sometimes, customers might not like what you’re offering. But are you in it for their money, or do you genuinely care about building the best business? The people who were in it because they thought it was easy money will quit. The people who genuinely want to improve will survive.
“The whole purpose of matches and losses is self-improvement. If you learned something from a match, it’s a good outcome. I’m thankful when a player beats me; defeats highlight my outstanding issues, and working to correct them is a chance to grow.”
In business, the concept of “matches” are your business strategies (you) and market irrelevance (the real competition). When people don’t buy, that means that your business strategies are simply losing ideas. Safe to say that all entrepreneurs face the shame of a losing idea at any point in their journey, more so during this time than before.
What should happen next? Here’s another quote from Daigo:
“The important thing [to stay on top of your game] is keep trying new strategies. Some will be more successful than others, and you will certainly question whether you’re trying the right thing at least a few times. Then, after three months or so, you’ll see the light at the end of the tunnel and settle on the form your big change will take. Of course, these tunnels of change come one after the other. Indeed, maintaining your strength as a gamer will mean passing through an unending series of tunnels.”
While many of us probably have heard of “being your strongest self” in one way or another, how do you implement it? Here’s my way.
Focus on Capability & Innovation Goals instead of Growth Goals
The best long-term solution to eliminate burnout is to plan for personal & organizational growth, instead of financial growth. Short-term financial goals should still be there, but it’s just serves as a check to keep you safe and in line.
Specifically, you’d want to define skill goals for yourself and your organization, and you’d want to plan for innovation (i.e. new / evolved products and new / evolved services). This requires you to stretch yourself to new fields, but it does not mean that it’s not achievable. A simple example is a generation-old restaurant business now looking to test out digital. I’ve shared the business rationale behind “innovation during recessions” in this article: https://medium.com/@kennyfrc/driving-growth-as-an-sme-during-turbulent-times-20760c9bbd52
Here are some examples of how I would define capability and service innovation goals for the organization:
Innovation Goals: Launch a self-service digital marketing education platform in Q3, Launch AI-enabled marketing technology software in Q4
Does the above comprise more than 5% of my revenue base? Not at all. Will it even give me a little bump in revenue? I doubt.
But does it position the organization to differentiate itself further and potentially have 3 different and stable revenue streams in a couple of years? Yes. Will it help position us better in a post-pandemic world where there’s probably a larger market who will want to test out digital either for themselves (course), with an experienced marketing team (software), and those who want to outsource to highly skilled people backed with AI-enabled software (service + software). Yes, yes, and yes.
The above goals make sense for me as I want the organization to deliver unmatched value in the future instead of chasing for profit now. I want other marketing firms to be held against the “Monolith standard”. I want potential employees to see Monolith as a rich place to learn and the best launchpad for their professional career. Exponential growth in business, like many things in life, requires structural changes, and by focusing on capability & innovation (or “focusing on getting stronger”) is a superior and a more achievable plan than looking to hit financial goals in turbulent times.
I’ll end with another quote from Daigo:
“Tournaments are a playground for people who practice for growth. It’s where they show off their achievements. Once I made that realization, I finally started making continued growth my goal, rather than winning. Games enrich my life by allowing me to grow as an individual, and that’s what motivates me to keep ongoing.”
The best way to win in business is when your organization can do things your competitors can’t.