The Importance of Sizing Up the Situation
In running a business or going after a project, once you know the particulars and the players and analyzed the complexity and ramifications, you should start to size up the situation. Sizing up means taking a step back and try to look at the big picture; grasping the correlations of each connections and the effects it will create.
An excellent example is the story of Raphael Tudela, a billionaire Venezuelan oil and shipping businessman that started out as a glass manufacturer. Being a petroleum engineer, however, Tudela wanted to plunge in the oil business. Tudela is a very smart executive that once he understands the facts, know what people want, he is able to give it to them.
An opportunity arose in the mid 1960s when an associate informed him that Argentina wanted to purchase $20million of Butane Gas. Tudela wanted to win the contract. He'll worry about how he could get the Butane later.
Here was a man with no oil experience or connection facing competition with British Petroleum and Shell Oil. After a bit of research, he found an interesting information, that Argentina had an oversupply of beef. Unrelated information to some, but very useful for Tudela. He made an offer to the Argentine government "to buy $20 million beef if they gave him the contract to provide $20 million Butane". Argentina gave him the contract solely based on this offer.
He then went to Spain where shipyards were going bankrupt with massive layoffs at the time due to lack of work. Tudela again used this information and offered the Spain government "I will build a $20 million oil supertanker at your shipyard if they bought his $20 million beef". The Spain government was ecstatic and had their ambassador inform the Argentina government to directly ship the beef to Spain.
Tudela's final stop was Philadelphia at the Sun Oil company. He came to them and said "if you charter my $20 million oil supertanker, which is currently being built in Spain, I will then buy your $20 million Butane Gas". Sun Oil agreed and Raphael Tudela was in the oil and shipping business.
This inspirational story proves that knowledge is power and those that can harness it to their advantage can go a very long way.
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