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Marshal Adequate Resources |
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Invest adequate resources so the operation can be sustained. |
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Home Depot, Toys R Us, and other giant category killers in the retailing marketplace understand how to marshal enough resources to overwhelm the market. By combining the concentration of an overwhelming assortment of merchandise with the propaganda of everyday low prices, they suck up market share like crazy. |
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The failure of many airline start-ups is an obvious business parallel to Sun Tzu's expressed need to have enough resources to survive. Often, these business failures are accompanied by an announcement that the organization ran out of capital before it could generate enough business to be profitable. So it is that all business problems eventually become financial problems. |
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Why is it that the cry from every business failure is: "We ran out of money." Of course they did! But the real problem was probably one or more of the following: not enough managerial talent or operational skill, wrong products or services, or one of a myriad of other inadequate resources required to make the organization successful. |
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The problem of adequate resources is especially critical in start-ups because they do not have the base of loyal customers that sustains mature businesses in an economic downturn. |
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In every battle, the one with the most resources has the odds in his favor. As Damon Runyon said, "The battle may not go to the strong, or the race to the swift, but that's the way to bet." |
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Allocation of adequate resources for development of future products and services assures success. In its first full year as an independent company, Lucent Technologies invested 11 percent of revenues in its Bell Research center which secures an average of three new patents every day. SmithKline Beecham and Microsoft invest more than 15 percent of sales in research and development.
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To achieve success, you must have superiority. However, that superiority is always relative. It is only necessary to answer the question: What is the allowable limit of resources to allocate? If you are truly determined to win, there is no upper limit. However, this does not mean you should recklessly squander resources. When resources are depleted and cannot be replenished, the result will be bankruptcy. |
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