Saturday, June 2, 2012

Lessons from Sam The Banana Man

Samuel Zemurray was an entrepreneur around the turn of 20th century.  As a son of immigrant family, he did not have a college degree yet he started out as banana trader and eventually ran United Fruit company, the world's most influential fruit company at the time.

He was known for his bottom-up management style.  He believed that good business acumen comes from knowledge and experience of how business works from the field.  He did not hesitate to travel out to Honduras to understand how banana was grown, shipped and put on the market.

Rich Cohen summarized 5 lessons that entrepreneurs can draw from Sam the Banana Man on his WSJ article:

1. Go see [the problem] for yourself [and do your own research].
2. Don't try to be smarter than the problem.
3. Don't trust the experts. [Become your own expert and make your gut decision.]
4. Money can be made again, but not a lost reputation.
5. When in doubt, do something! [Take action in face of crisis.]

Most of these points are straight forward except #2.  Here's what Rich wrote about #2 on WSJ:
"In the late 1920s, United Fruit and Sam's company were trying to acquire the same piece of land, a fertile expanse that straddled the border of Honduras and Guatemala. But the land seemed to have two rightful owners, one in Honduras, the other in Guatemala. While U.F. hired lawyers and commissioned studies, trying to determine the legal property holder, Zemurray simply purchased the land twice, once from each owner. A simple problem deserves a simple solution."
Every problem has multiple solutions.  Being an entrepreneur is being a leader.  Being a leader means that you are responsible for getting things done.  Sometimes over-thinking a problem creates distraction from actually solving the problem.  When solving a problem, you have to stay flexible to consider other alternatives; however when it comes to getting it done, you have to keep in mind that execution is what really counts.  Think about what needs to get done, and get it done.

I like the lessons that Rich shared on his article.  Especially finding out the problem for yourself and doing your own research to formulate your own opinion makes lot of sense in today's business environment.

To serve the customer better, you have to be out where you can see the problem.

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