Wikipedia begins their article on Perot with: Henry Ross Perot is an American businessman best known for running for President of the United States in 1992 and 1996.
Well, maybe he is “best known” for his failed attempts at the presidency; but I have much higher regard for his abilities as an economist and an elevator service technician, although I’m not sure he’s ever claimed to be either one.
First, let’s talk about economists. They live by their concepts and theories, with SUPPLY and DEMAND being the holy grail.
Three Ways to Look at Supply and Demand When Starting a New Business
There are essentially three approaches.
- Open a business doing something you think you’re really good at doing or something you really enjoy, OR find an infinite supply of a product you can sell. Then find your customers.
- Discover a reachable group of potential customers with a genuinely identifiable need. Then figure out a way to fulfill that need.
- And the best of all: Find an infinite source of goods or services, known as SUPPLY, then find an infinite group of hungry customers, known as DEMAND – and BECOME THE LINK.
And that’s exactly what Ross Perot did, in typical Perot style.
Regardless of what you may have thought of Perot as a presidential candidate, he is, without doubt, one bright, aggressive, determined soul. He entered the U.S. Naval Academy, became president of his graduating class, but soon decided against a career in the military.
He then joined the IBM sales team, back when IBM was King of Computing, in the days long before personal computing. His world was one of giant mainframes and he quickly soared to the top of the sales leader board.
One year, he met his annual sales quota in two weeks!
He left IBM in 1962 and founded EDS, Electronic Data Systems, but he made a single discovery before he left IBM that would make him his fortune.
Most of the big computers he sold to his IBM clients were only utilized for a few hours each day. They sat idle most of the time. Perot asked his clients if he could buy this idle time from them, and of course, they were more than happy to lease this time to him.
Perot then went out to sell this data processing time to his new clients. However, he did not meet with immediate success. In fact, he got a big NO on his first 77 attempts to sell. But then, on his 78th presentation – SUCCESS, and it got much easier from that point, eventually including huge and very profitable contracts from the US government, even the job of computerizing Medicare records.
But wait, what’s this about fixing elevators?
As we know, Perot had ample supply (idle computing time); and he had demand (lots of paperwork that would eventually be replaced by computers), although many of his future clients did not yet know it.
Perot once pitched an account that was handling all its employees healthcare insurance claims in-house. This client did not feel that processing paperwork was too overwhelming for his staff, and decided against signing with Perot.
Only a few weeks later, Perot got a call from the prospect, “Help, we need your services.”
As it turned out, the overworked claims processors, when they found themselves hopelessly behind in their work, had taken to the nasty habit of depositing employee’s claim forms down the elevator shaft… thousands and thousands of sheets of paper.
Until one day, the pit (the area at the bottom of an elevator shaft) became so filled with forms that the elevator could no long come to rest at the first floor.
The client signed immediately.
Ross Perot eventually sold EDS to General Motors in 1984 for a mere $2.4 billion.
Here’s your challenge. Find the supply, find the demand, and make yourself the link. GOOD LUCK!