Advice on Growing a Small Business from Former Apple CEO John Sculley

By Margot Carmichael Lester, Staples® Contributing Writer

“I believe we are entering an unprecedented era for major new business opportunities. While I have always been an optimist, I think this is the most exciting time in my life to be in business.”

—John Sculley

Sculley is a well-known entrepreneur and business leader, having helmed both Pepsi-Cola and Apple. He was involved in one of the major innovations in product packaging (plastic soda bottles) and one of the few flops Apple ever had (The Newton). Despite his high-profile big-business career, Sculley is passionate about helping small business owners and entrepreneurs grow their own enterprises. His new book, Moonshot! Game-Changing Strategies to Build Billion-Dollar Businesses, includes insights and actionable advice for owners of any size business. In this edited transcript of our interview, Sculley shares his thoughts on small business success.

You’ve said that the best advice you can give a business owner is “get a mentor.” Why is that?

A mentor is a huge confidence builder. You don’t understand something until you understand it more than one way, and with a mentor, you can see a problem from many vantage points. A mentor’s very valuable as another set of trusted eyes. Today you should spend more time being curious. You need to ask better questions. It’s about gathering all the information you can get and figuring out if you’re asking the right questions.

How can we find a mentor to help us build our business?

Network! Go to events where people you admire are showing up.

Why do you believe that a “lights-out” customer experience is the most important strategy for business success?

Customer retention has huge implications on profitability. It’s 5 to 8 times more expensive to replace lost sales than if you hold onto them in the first place.

What does that mean for small business owners?

There’s been a power shift enabled by how people are using technology today. The customer suddenly feels more in control. They see more alternatives and are paying more attention to the opinions of other people. That’s fueled such a fundamental change in the way business owners need to think — it doesn’t make any difference if you’re a start-up or a small or medium-sized company: Everything revolves around the focus on customers.

How can small business owners improve customer focus?

If you don’t have customer metrics today, you’re running a high-risk business even if you didn’t think you were taking risks. You reduce your risk and exposure to someone else taking your business away if you start to look at it through customer metrics — to see where the risks are in each stage of customer experience, from engagement to conversion to acquisition to retention. You need a customer plan.

That’s why I say the business plan is obsolete. That’s a little overstated, but business plans are a budgeting exercise. Business owners often spend a tremendous amount of time putting them together, looking at last year and next year how much you can expect to improve, allocating resources to continue what you’ve been doing. But that’s not how the market works anymore. Customers don’t care about your business plan. They care about who’s got the best product or service, what others think about it, and the price versus alternatives.

Any final advice for small business owners?

Never get complacent. If there’s no sense of urgency in an economy where things move so rapidly and industries change so quickly, competitors can move in on short notice and market demand can shift fast. More people fail not because of what they do, but because of what they don’t do. It’s what you don’t do that creates the lost opportunities as opposed to things you did do that are wrong.

Which is why you encourage us to embrace failure as you have.

Right. Here’s the most import lesson: You only learn from your mistakes. You never learn from successes. We really learn when our back’s up against the wall and we have to make tough choices, like laying people off or changing your pricing model or cutting products from your inventory. It’s always from your mistakes that you get your deepest learning.

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