No. 12 December 2013

In a recent interview in the November 3rd edition of the Sunday New York Times, David Cote, the Chairman and CEO of Honeywell, talked about how making good decisions is critical to the success of a business.  A decisive business leader “wants to make decisions often and quickly (i.e. ‘give me what you’ve got and I’ll make a decision’.)  And the lower you are in an organization, you can get away with a lot of that and you’ll be applauded for it.”

“But with bigger decisions, you can make bigger mistakes, so you really have to think about the kind of decision you’re making.  Is this a decision where if I’m wrong, there can be significant ramifications?” 

“What I’ve taught myself to do is to tell everybody that this is a preliminary decision and we will go through it again in a day or two, because it’s so important to get it right.”

“If I’m very decisive and I surround myself with people who just want me to make decisions, then we’ll go off the cliff at 130 miles an hour, because at some point I’ll be wrong.  What I need are people who want to come to their own conclusions and are willing to think independently, and can argue with me in the right way so I can (keep the process) objective as opposed to emotional.”

“There’s this phrase I use a lot when I teach leadership classes at Honeywell:  ‘Your job as a leader is to be right at the end of the meeting, not at the beginning of the meeting.’  It’s your job to flush out all the facts, all the opinions, and at the end make a good decision, because you’ll get measured on whether you make a good decision, and not whether it was your idea from the beginning.”

In running our businesses, we spend a lot of time making decisions.  And each decision we make has a huge impact on our success, so it pays to make every decision as good as we can.  David Cote is suggesting that we can make better decisions when we’re armed with all the facts (i.e. you’re never as well informed at the beginning of a meeting as you are at the end.)  That’s something you should consider the next time someone pressures you to make a quick decision.

I hope you’re celebrating the Holiday Season with family and friends and not setting new world-records for eating the most food at a family get-together.  Sometimes you want to say out-loud:  “Wait a minute, this isn’t an eating contest, is it?”

Here’s my favorite Charles Schultz story that really puts “what’s important in our lives” into perspective:

“Every time I see these questions make the rounds via email around the Internet, I’m reminded of what truly is important in life.  Don’t answer the questions. Just read it to the end, and you'll get the point.

1. Name the five wealthiest people in the world.

2. Name the last five Heisman trophy winners.

3. Name the last five winners of the Miss America Pageant.

4. Name ten people who have won the Nobel or Pulitzer Prize.

5. Name the last half dozen Academy Award winners for best actor and actress.

6. Name the last decade's worth of World Series winners.

How did you do?

The point is, none of us remembers the headliners of yesterday. These are no second-rate achievers. They are the best in their fields. But the applause dies. Awards tarnish. Achievements are forgotten. Accolades and certificates are buried with their owners.

Here's another quiz. See how you do on this one:

1. List a few teachers who aided your journey through school.

2. Name three friends who have helped you through a difficult time.

3. Name five people who have taught you something worthwhile.

4. Think of a few people who have made you feel appreciated and special.

5. Think of five people you enjoy spending time with.

Easier?

Give yourself credit for remembering the people who really made a difference in your life.  They didn’t have the most credentials, the most money or the most awards.  They just cared about you.  Whose life have you made a difference in recently?”

Remember that you have a choice every day about how you approach life and the people around you.  Make it positive.  Make it thankful.  Count your blessings.  Then share a few.  Happy Holidays!

No. 11 November 2013

I read an interesting online article by Michael Schrage titled, “Time to Hang Up on Voice Mail.” I don’t know about you, but I’ve almost done that already. Who wants to leave a 90-second message after the beep, much less listen to one? We all have faster, better and friendlier ways to communicate.

Have you received a notice yet from a personal or corporate voice-mail box, warning you that messages are rarely retrieved and you would be better off sending an e-mail or text? Schrage says, “Truly productive people have effectively abandoned voice mail, preferring to visually track who’s called them on their mobiles. Irritated office workers, by contrast, despair that their desk phones can’t display who’s called and when. When that occurs, they’d be better off if office calls were forwarded to their devices with the relevant Caller IDs attached.”

“For most organizations, the only people who matter going into voice mail are customers and clients!” adds Schrage. “How smart and customer-centric is that? Not very. Nobody wants to be put in voice mail anymore, and it’s quite likely that customers and clients aren’t listening to your voice-mail messages either.”

Schrage ends with this comment, “(Do) you want to have better, faster and more responsive communications inside your organization and save some money besides? Have an online conversation about online communications – and unplug your voice-mail system. If you’ve got a problem with that, don’t bother to comment. But do feel free to call me and leave a message.”

A super container freighter measuring 1,500 feet long by 196 feet wide by 10 stories high is currently under construction. These super ships are so huge and sit so low in the water, that the Port of Rotterdam has already started redesigning and dredging their existing port, as well as modifying berthing and loading accommodations for first use in 2014. It will initially be the only port in the world capable of handling these super freighters.

Did I mention these super container ships will be able to carry 22,000 containers at a time? If you are importing bicycles and each container holds 175, the new super freighters will be able to transport 3,850,000 bicycles in one trip! If you were ordering cable set top boxes, knowing that one container will hold 6,000, you could receive 132 million of them in one shipment. Unbelievable, isn’t it?

Everyone knows that happiness is a state of mind, right? Wrong! Happiness is a state of a positive mind. Negative people can easily find faults in any happy situation, and positive people do exactly the opposite. When you have a positive outlook in life, happiness will find a way. Happiness is more of a personal choice (a statement you’ve read more than a few times in this column).

Even the most optimistic of us can find ourselves in a rut where everything seems to be going against us. But if you take a close look at yourself that very instant, don’t YOU have a lot to be grateful for? William Penn said, "The secret of happiness is to count your blessings while others are adding up their troubles.” When you list down all the things that you feel privileged to possess and often take for granted, you will suddenly realize and appreciate even more, what you have been blessed with. Positive thinking will turn your obstacles into opportunities.

I leave you now with Dale Carnegie’s poignant words about the power of a smile. Read and remember them.

"It costs nothing, but creates much. It enriches those who receive, without impoverishing those who give. It happens in a flash, and the memory of it sometimes lasts forever. None are so rich they can get along without it, and none so poor but are richer for its benefits.

"It creates happiness in the home, fosters goodwill in a business, and is the countersign of friends. It is rest to the weary, daylight to the discouraged, sunshine to the sad, and nature’s best antidote for trouble.

"Yet it cannot be bought, begged, borrowed, or stolen, for it is something that is no earthly good to anyone 'til it is given away. And if, in the hurly-burly bustle of today's business world, some of the people you meet should be too tired to give you a smile, may we ask you to leave one of yours?

"For nobody needs a smile so much, as those who have none left to give." 

No. 10 October 2013

Karl Pillemer is a gerontologist (someone who studies older people) who, in his work, kept meeting older people – many of whom had lost loved ones, been through tremendous difficulties, and had serious health problems – who nevertheless were happy, fulfilled, and deeply enjoying life. He found himself asking, “What’s that all about?” As he looked through existing research, he found that study after study validated the fact that older people – in their 70s, 80s and beyond – are actually happier than younger people. Pillemer thought that perhaps older people knew things about living a happy, healthy, fulfilling life that younger people didn’t, so he decided to find out what that practical wisdom was. He interviewed 1,000 seniors and asked them, “What is the most important lesson you want to pass along to the young?” From his interviews came his book, 30 Lessons for Living: Tried and True Advice from the Wisest Americans.

Here are a few of his findings about some of life's lessons that older people have learned during their long lives:  “…one lesson stood out; a lesson that older people knew about because of where they stand on life’s road – but that younger people could benefit from learning about. It was a lesson that almost all expressed. And they did it vehemently.

“What they wanted younger people to know is this: life is short. The older the respondent, the more likely they are to say that life passes by in what seems like an instant. They say this, not to depress younger people, but to get them to be more aware and selective about how they use their time. Older people practice what psychologists call ‘socioemotional selectivity’ – because their time is limited, they make careful decisions about how to use their time. Some implications of this insight are to say things now to people you care about, whether it is expressing gratitude or love; asking forgiveness or getting information; spending the maximum amount of time with children or grandchildren; and savoring daily pleasures instead of waiting for ‘big-ticket items’ to make you happy.

“The other piece of advice that comes from this idea that life is much shorter than you realize: Take a chance. People in their 70s, 80s, 90s and beyond endorse taking risks when you’re young, contrary to a stereotype that elders are conservative. Their message to young people starting out is ‘Go for it!’ They say that you are much more likely to regret what you didn’t do than what you did. As one 80-year-old said, ‘Unless you have a compelling reason to say no, always say yes to opportunities.’

“Elders have also learned that happiness is a choice – not a passive condition dependent on external events, nor is it the result of our personalities. We can choose – in a conscious shift in outlook every day – optimism over pessimism, hope over despair.” We can take responsibility for our own happiness throughout our life. As I’ve said many times in this column: Life is about choices every minute of every day. We can choose to be happy, smile and uplift people, or we can choose to put people down and try to make them as unhappy as we are. It’s not your personality. It’s your choice!

We also know experience is very important in our work lives. Harold S. Geneen, the former CEO of AT&T, had this to say about business experience: “In the business world, everyone is paid in two coins: cash and experience. Take the experience first; the cash will come later.” Those are true words of wisdom.

Harvey Mackay tells a story about “a little boy spending his Saturday morning playing in his sandbox. He had cars and trucks, his plastic pail, and a shiny red shovel. In the process of creating roads and tunnels in the soft sand, he discovered a large rock in the middle of the sandbox.

“The boy dug around the rock, managing to dislodge it from the dirt. With a little bit of struggle, he pushed and nudged the large rock across the sandbox by using his feet. When the boy got the rock to the edge of the sandbox, he found that he couldn’t roll it up and over the wall of the sandbox. Every time he made some progress, the rock tipped and then fell back into the sandbox.

“Frustrated, he burst into tears. All this time, the boy’s father watched from his living room window. As the tears fell, a large shadow fell across the boy and the sandbox. It was his father. Gently but firmly, he said, ‘Son, why didn’t you use all the strength that you had available?’

“Defeated, the boy sobbed back, ‘But I did, Daddy, I did! I used all the strength that I had!’

“‘No, son,’ corrected the father kindly. ‘You didn’t use all the strength you had. You didn’t ask me.’ With that, the father reached down, picked up the rock, and removed it from the sandbox.

“Successful people rarely reach the top without a lot of help along the way. The ability – and willingness – to ask for help is one trait that really stands out among those who are truly committed to success.” Seeking help and advice, when you need it, will move you quicker down the highway of success.

No. 9 September 2013

Harvey Mackay tells the following story about a son asking his mother what he needs to do to be a success when he grows up.

“The mother thought for a moment, and then told her son to bring her a pencil.  Puzzled, the boy found a pencil and gave it to her.

“If you want to do good,” she said, “you have to be just like this pencil.”

“What does that mean?” her son asked.

“First,” she said, “like a pencil, you’ll be able to do a lot of things, but not on your own.  You have to allow yourself to be held in someone’s hand.” 

The mother is talking about teamwork.  You can’t do it all by yourself.  Mackay defines teamwork as a collection of diverse individuals who respect each other and are committed to each other’s success.  You can’t be successful without a committed team working with you.

“Second,” she said, “like a pencil, you’ll have to go through a painful sharpening from time to time, but you’ll need it to become a better pencil.

Giving and taking criticism is not easy task, but it is necessary to become better.  No one ever choked to death swallowing his or her own pride.  Accepting honest criticism or a suggestion will make you better than you were before.

“Third, like a pencil, you’ll be able to correct any mistakes you make,” she said.

Everyone makes mistakes.  That’s one way you learn.  Mistakes don’t make you a failure.  There are really no mistakes in life, there are only lessons.

“Fourth, like a pencil, no matter what you look like on the outside, the most important part will always be what’s on the inside. 

Most people aren’t born with self-confidence.  Mackay’s advice to develop self-confidence is: track your success, practice being assertive, accept that failure is not the end of the world, step out of your comfort zone, set goals, keep improving your skills and above all else, don’t compare yourself to others.

“And fifth,” the mother finished, “like a pencil, you’ll have to press hard to make a mark.”

Success comes before work only in the dictionary.  There is no magic formula or magic wand.  Even people with natural talent or skills, continually hone those talents or skills with lots of hard work and practice.

The mother touched on five important topics – teamwork, being able to accept criticism, correcting mistakes, self-confidence, and working hard.  That’s good advice for all of us.

Rev. Robert Schuller says there are four kinds of people: "First, there are the cop-outs. These people set no goals and make no decisions.

"Second, there are the hold-outs. They have a beautiful dream, but they’re afraid to respond to its challenge because they aren’t sure they can make it. These people have lost all childlike faith.

"Third, there are the drop-outs. They start to make their dream come true. They know their role. They set their goals, but when the going gets tough, they quit. They don’t pay the toll.

"Finally, there are the all-outs. They are the people who know their role. They want and need and are going to be stars: star students, star parents, star waitresses. They want to shine out as an inspiration to others. They set their goals. . . . The all-outs never quit. Even when the toll gets heavy, they’re dedicated. They’re committed."

To be committed, you must be "all in." You can’t just do the best you can. You have to do everything you can. Remember, the difference between 100 percent ‘all in’ and 99 percent ‘all in’ is 100 percent.

 When I think of commitment, I think of the story of the Pig and the Chicken walking down the road.

 The Chicken says: "Hey Pig, I was thinking we should open a restaurant!"

The Pig replies: "Hmmm, what would we call it?"

The Chicken responds: "How about “Ham-n-Eggs?”"

The Pig thinks for a moment and says: "No thanks. I’d be committed, but you’d only be involved!"

No. 8 August 2013

I recently read a blog article by Bernadette Jiwa titled, “The Secret of Disruptive Innovations.” Her examples and conclusions will make you “think twice” about what you thought you knew about the effect of disruptive innovations on yourself and your business.

“When the online eyewear retailer Warby Parker began selling boutique-quality glasses at a $95 price point, they weren’t just trying to undercut the bigger players in the industry. Of course, they did that and more, growing the company by 500 percent in just a year and mostly by word of mouth.

“The average customer who needs glasses buys a pair every 2.1 years. Warby Parker set out to make glasses something that customers would buy in multiples as fashion statements; much like women buy shoes and bags. They wanted customers to view them as accessories they could change to match occasions or moods. And while price combined with

quality enables the company to tell a different story than other retailers, what changes everything is the story the customer now tells himself about how many pairs of glasses he can own and how often he should buy new ones. Many of Warby Parker’s customers buy six or seven pairs of glasses at a time and not just when their prescription expires.

“AirBnB made people long to experience a destination like a local hotel without the $8 price tag for nuts from the mini-bar. Apple changed how we feel about buying a whole album, including the songs we didn’t care about. Amazon’s Kindle made us think of airport bookstores as reference libraries where we browse but don’t buy.

“The secret of disruptive innovations and business models isn’t that they disrupt an industry. It’s that they disrupt people. They change how people feel about something enough to change how they behave.

It’s entirely possible to look into the future and think about how your customer might be changed tomorrow as a result of what you do today. While ‘the industry’ works on the assumption that the larvae of today will just be bigger caterpillars tomorrow, the disruptor imagines butterflies.”

One day an entrepreneur took his young sales manager Bill up to a magnificent estate overlooking a beautiful river. He then took him up on the highest peak on the property, put his arm around him, pointed down, and said: “Look at that stunning home and gorgeous swimming pool! How do you like those fabulous tennis courts? Take a look at those beautiful horses in the stable. Now, all I want you to do is continue to meet the high standards and goals I’ve set for you and someday, Bill…someday, all this will be mine.”

The following blog title recently caught my attention: “Why You Shouldn’t Strive for Perfection.”  Reading that statement made my blood pressure rise.  

A little further reading made it go up even more, as I read about a writing professor who presented his class with this assignment: 1. Write something that is just ‘so-so.’ 2. Do some research or get some feedback from a mentor or teacher. 3. Try again to make it better.” I wondered to myself, “Why would anyone strive to do something just “so-so” instead of always doing the best that they could do?”

The author’s three-part explanation for not striving for perfection all the time read as follows: “1. When you work toward making something just ‘so-so,’ it takes all the anxiety and fear out of the experience. 2. Once you’re not worried about failing, you can concentrate on your task. 3. As you work toward step #3, ‘make it better,’ you are acknowledging that

there’s plenty to learn.”

And finally, there was the following three-part summary: “1. In learning a new skill, don’t focus on perfection. 2. Make your goal to produce something ‘OK,’ then get some help, and then make improvements. 3. Rinse and repeat until you are satisfied.”

I suppose that the words about working to a “so-so” or “OK” result struck me the wrong way. My comment I left on that blog follows, first, with a quote by legendary football coach Vince Lombardi and then my personal comment.

The Lombardi quote: “Gentlemen, we are going to relentlessly chase perfection, knowing full well we will not catch it, because nothing is perfect. But we are going to relentlessly chase it, because in the process we will catch excellence. I am not remotely interested in being just good.”

Then, I commented, “In my long business career, I have never strived to be ‘so-so’ or ‘OK’ at doing anything. I have always strived to be the best I could be, never expecting perfection, but always striving for it. I can’t imagine my managers and employees doing their jobs expecting the results to be ‘so-so.’ Learning and improving are part of any process. But the expectation should always be to do or be the best you can.”

What do you think? Should you strive to do an “OK” job, or should you strive to always do your very best?

No. 7 July 2013

I know you read the headlines in 2012 about Ron Johnson, the Apple vice president, who was hired away from Apple to become the president of J.C. Penney (“Penney”). By the spring of 2013, he was gone — fired by the Penney board of directors. I wanted to find out why, because I was sure there were some good business lessons to be learned. As it turns out, there is much to be learned from what Johnson did and did not do at Penney.

When Johnson arrived at Penney, he found a culture of sales, markdowns and coupons — exactly the opposite of Apple’s culture of high prices and a very high level of service to go with it. In Penney’s culture, I’m sure Johnson saw that constantly changing prices in the stores took lots of manual labor. At Apple, there were no surprises in margins and gross profit, managing to budgets was easier, and there was more efficiency throughout the enterprise. Inventories were stable at Apple, and there were no whiplash effects of selling thousands of an item one week and none the next week because of discounting and coupons.

The interesting fact was that Penney customers were actually not paying less in the old culture. Penney just kept raising prices and then discounted those prices during promotions. The average markdown was 50 percent. Low consumer prices were really a mirage. But Penney customers were conditioned to wait for deals and sales, partially because they did not have a good sense of what an item was really worth.

Alexander Chernev, a professor at the Kellogg School of Management at Northwestern University, summed up the faults in Johnson’s strategy this way: “By going to everyday low and ‘fair’ pricing with a single non-discountable price, Johnson assumed consumers have some context for how much items should cost. But they don’t. Penney might say it’s a fair price, but why should consumers trust Penney?” Chernev asked. “At the end of the day, people don’t want a fair price. They want a great deal. Consumers infer that they get a great deal based on the reference point provided by the higher, presale price. Social scientists refer to this idea as anchoring, and it applies to all sorts of consumer behavior and expectations. Without that anchor, consumers have trouble determining whether the store is actually giving them a good price.”

A Journal of Retailing study says, “Even the words a retailer uses in its marketing can affect how a customer judges a deal — ‘sale’ or ‘special’ leads people to think the item has a high value, but a straight markdown leads them to think it’s a cheaper item.”

In the old Penney culture, limited-time sales lured customers into the stores, which was very important because Penney doesn’t have a differentiated, high-value product like Apple. Also, coupons were effective in drawing in a broader consumer base — one shopper to buy at a high price, and a more price-sensitive shopper to buy the same item at a lower price.

Which retailers have been able to make everyday low pricing successful? Those that take narrow profit margins like Costco and Wal-Mart. Costco almost never runs sales and doesn’t adjust prices much, but it depends a great deal on annual membership fees for profit. Wal-Mart makes up for low margins with huge volumes of customers that come to its stores. But there was no such clarity at Penney. Penney told its customers to expect low prices — but not the lowest prices. Penney could not communicate exactly how much its shoppers were saving with everyday low pricing, and regular Penney shoppers became confused and stayed away.

Now, we’re reading that Penney employee layoffs have affected employee morale at Penney. Will good customer service be the next thing to go away at Penney?

Harvey Mackay reminds us that one of the most important things employees can remember when they come to work every day is “that their primary job is to provide incredible customer service.” That’s the culture you want in your business.

Mackay goes on to say, “Perhaps the simplest way of creating a service culture is a variation of the golden rule: Treat your customers as you wish to be treated.  Make your customers excited that you’re in business. Make them grateful that they have the opportunity to buy your services and products. Make them feel like they are your most important client. Make your service so outstanding that they wouldn’t even think of doing business with anyone else. And then find a way to make your service even better! Remember: Customer service is not a department, it’s everyone’s job.”

No. 6 June 2013

Many businesses with low-cost production, operating or selling cost advantages automatically charge lower selling prices. But many businesses with low-cost advantages invest that extra margin to create competitive advantages. Mars (the candy company) is a great example of a company investing extra margin to create competitive advantages against a larger rival. Here’s part of an article I recently read about Mars’ strategy to create a competitive advantage.

“Since the 1980s, Mars has held a distinct cost advantage over Hershey’s in candy bars. Mars chose to structure its range of candy bars so that they can be produced on a single super-high-speed production line. The company also utilizes less-expensive ingredients (by and large). Both of these choices greatly reduce product cost. Hershey’s and other competitors have multiple methods of production and more-expensive ingredients and hence higher cost structures. Rather than selling its bars at a lower price, Mars has chosen to buy the best shelf space in the candy bar rack in every convenience store in America. Hershey’s can’t effectively counter the Mars initiative; it simply doesn’t have the extra money to spend. On the strength of this investment, Mars moved from a small player to goliath, Hershey’s main rival, competing for overall market share leadership.”

Two other good points the author made: “(1) You don’t get to be a cost leader by producing your product or service exactly as your competitors do, and you don’t get to be a differentiator by trying to produce a product or service identical to your competitors.” (Sounds like common sense to me.) “(2) Many companies like to describe themselves as winning through operational effectiveness or customer intimacy. These sound like good ideas, but if they don’t translate into a genuinely lower cost structure or higher prices from customers, they aren’t really strategies worth having.” (Why have strategies if they don’t give you the results you need to operate more efficiently or profitably?)

When you need a little humor in your life, remember the name of writer and humorist Joyce Wadler. When you see her name on a blog or an article, get ready for a treat! Here’s a “taste” of her style and humor from an excerpt from a piece she wrote February 28 for The New York Times, called “On the Road, With Mothers.” Her humor still brings a smile.

“I went on a road trip with my mother in Northern California a few years back, and if you were heading down the mountain on Route 101, you probably remember us. That’s because cars were lined up behind us for at least three miles. Once in a while, a driver would become so unhinged driving 35 miles per hour for 40 miles he would hit the gas hard in a no-pass zone, risking death in a ravine -- an option, after being on the road for four days with my mother, I was wistfully considering myself.

“I’ve have been thinking of writing a book, ‘How to Travel With Your Mother,’ but it would be a very short book. That is because my tip is: Don’t. Do not ever travel with your mother.  Unless maybe you are disposing of her ashes.  And even then, there’s a good chance you will hear her voice in your head: ‘You packed the box with my ashes without double wrapping it in Saran Wrap and putting it in a baggie? Look at this box, it’s cardboard, it’s nothing. What if I spill all over this suitcase? By the way, how are you planning to do this? If there’s a wind, make sure it’s not blowing at you, and when you open the box, make sure you don’t pour it over your head.’”

What does your brand stand for? Seth Godin, considered by many a marketing genius, says if you told him your “brand stands for service and quality and customer focus, you haven’t answered his question, because a hundred other brands stand for that. If you are what others are, then there’s nothing to own or protect or build upon. Hyatt, Marriott, Hilton…they don’t stand for anything, do they? They can’t, because they stand for precisely the same thing. Puma vs. Adidas vs. Nike…they all want to stand for winning. How substantial are the differences? Make your own list of differences and the extremes for your brand, and start with that. A brand that stands for what all brands stand for, stands for nothing much.”

Objection from a former sailor to a newspaper editor regarding comments people make about our President and our Congress: “To the editor: I object and take exception to everyone saying that Obama and Congress are spending money like a drunken sailor. As a former drunken sailor, I quit when I ran out of money. Bruce L. Hargraves, USN Retired.” I hope that brought a smile.

In case you were wondering, the least popular clothing color in 2012 was…manatee gray! Supposedly, it was a real color choice, but I hope the person who chose it to use in a ladies clothing line has a different job today. Picture, if you would, a manatee gray dress and the lady wearing it, or a manatee gray car and the person driving it. Are you smiling yet?

No. 5 May 2013

Was March colder than usual in your part of the country?   According to Weather Trends International, March 2013 was the coldest March in the U.S. in 17 years, with the most snowfall in 20 years.  Consumers stayed home and retailers “took it on the chin,” gas prices remained high, the job market remained tepid at best, and consumer confidence remained low. 

In March 2012, our sales were booming, flowers and trees were blooming, grass was growing and the temperatures were warm.  In March 2013, none of the above occurred. April arrived, and finally trees begin budding out, crocuses and daffodils broke through the soil crust, our days and nights warmed up and our grass needed cutting.  But the sad fact, at least for our business, is that those lost sales in March are gone forever and we won’t make them back in the coming months.

If we want a good laugh, we look at the budget numbers for March and April of 2013.  Controlling overhead and labor becomes even more crucial with lower year-to-date sales.  It means once again choosing the battles to wage that you can win; controlling those things that you can control; and not worrying about those things you have no control over.  My mantra is that every year is different than the year before and always different than what you plan for.  Use the wisdom you’ve gained over the years to manage your business for success and profit.  And know that in 2014 spring will be later or earlier than you’ve planned for.  It’s just the “nature” of the business (pun intended.)

One of the most important things a leader, owner or manager can do is listen to people inside their business.  Here’s a short version of a true story that illustrates the importance of listening to, caring about and complimenting the success of your employees:

Demoralized, workers at a manufacturing plant came to work every day putting in eight hours in “robot mode.”  The company was near bankruptcy and workers shut down their minds and bodies once the “start button” was pushed until someone hit the stop button at the end of the day.  A larger company acquired the plant in 2005 and began implementing a 7S lean program. 

Chris, a machinist with the company for 15 years, explained what happened to him and other workers.  “I participated in my first 7S event, our process to improve workplace organization,” he explained.  “On day one I just sat there, still acting like a robot.  But by the third day of the event, I could see that they actually cared what I thought.  I was able to get some extra tools and racks for my machine that I had needed for the last five years.  For the first time, I was allowed to make my work easier, cleaner, and safer.  Once I got started I didn’t want to stop improving my work environment.  People began coming over to my area and complimenting me on how great it looked.  That might have been the first compliment I received at work in five years.”

“A few months later, our continuous improvement leaders asked for volunteers willing to learn how to lead 7S events.  I jumped at the chance and found myself in a company-wide leadership development program alongside directors and department leaders.  I learned so much and realized how many people in this company wanted to make it better.  I became part of creating the most organized machine shop in the company.  Our customers come through and tell us how impressed they are.”

A VP of the acquiring company had this to say about the transformation of Chris and his fellow workers: “Chris had so much more to offer the business than he was allowed to give.  The old company had been paying for Chris’s (and his fellow workers’) hands for years when they would have given their heads and heart for free if the old company had known how to ask.

The tools of ‘lean’ coupled with people-centric leadership allow us to ask those at the front lines to engage their heads and hearts in meaningful work.  We ask them to partner with us in pursuit of our shared vision.  We recognize and celebrate their contributions.  They see that what they do matters and who they are matters.  We are stewards of each life that comes under our care through our leadership.  We owe them much more than work that turns them into robots.” 

Make sure that your employees’ heads and hearts are engaged in creating success for your business.  And that they are recognized for it.  Your customers and your profits will both benefit greatly.

No. 4 April 2013

Daniel Pink says in his new book “To Sell is Human: The Surprising Truth About Moving Others,” that “in the U.S., 40% of the time we spend at work, even in a non-sales job, is spent in a ‘non-sales selling process’ involving persuading, influencing, motivating and convincing others, in ways that don’t necessarily involve the purchase of a product in the end.” 

For example, you could be pitching an idea to your boss, or trying to motivate employees to get on board with a new initiative, or getting a customer to act on your recommendations.  These “selling activities” go on all the time in the workplace.

Pink notes how “for an increasing number of businesses, there are no salespeople – or at least, no dedicated salespeople with that job title.  Instead every aspect of delivering the product or service is part of the sales process, built on the simple idea that if customers are served well, they will do more business in the future and refer friends, family and colleagues to do the same.”  As a result, everyone in the business should have a skillset that includes service and at least some selling or persuading skills.

Pink says “the world is shifting from ‘caveat emptor’ – where the buyer must be wary of being taken advantage of by a more knowledgeable seller – to a world of ‘caveat venditor’ where the seller must beware because businesses that serve buyers poorly will lose referrals and growth to those that treat their customers well.” 

“More than ever, effective sellers must be aware and understanding of the needs, concerns and interests of the customers they are working with.”  Pink suggests “this skill of ‘attunement’ and being able to see the world from the perspective of the customer will be a key selling skill for the 21^st century.”

Pink also gives credence “to how the ‘science’ of selling, motivating and persuasion really works.”  For example, “we find recommendations and statements more convincing when they rhyme; granular numbers are more credible than coarse numbers (i.e. we think devices with a battery life up to 120 minutes will last longer than those with a battery life up to 2 hours!); and we work harder when we feel a more personal connection (i.e. radiologists catch problems more often on X-ray scans that are accompanied by a picture of the patient.)”

Reading “To Sell is Human: The Surprising Truth About Moving Others,” won’t make you a super salesperson.  But it will help you manage the selling challenge you and I face every day in our businesses.  Remember that we use critical selling skills each time we persuade, influence, motivate or convince our employee’s, co-workers or bosses to agree with our conclusions and beliefs.

Did you know a loyal customer is worth a whole lot more to you over time than a satisfied customer?  Customer satisfaction remains a “must-do,” but the most important questions are ”Would the customer recommend you to someone else?  Would they “hire” you again?”  Don’t forget that the value of a returning loyal customer is huge especially when compared to the cost of obtaining a brand new customer and earning that person’s loyalty.

I wanted to share a few very interesting thoughts from Thomas Friedman’s March 5 Blog about today’s college students and how the business world views them. Talking about college students, Friedman said, “the world does not care what you know.  Everything is on Google.  The world only cares, and will only pay for, what you can do with what you know.  Therefore it will not pay for a C+ in chemistry, just because your state college considers that a passing grade and was willing to give you a diploma that says so.  We’re moving to a more competency-based world where there will be less interest in how you acquired the competency – in an online course, at a four-year college or in a company-administered class – and more demand to prove that you mastered the competency.” 

Don’t forget Friedman’s simple but very true statement: “The world only cares and will only pay for what you can do with what you know.”   Bet on it.

No. 3 March 2013

Growing a business is a subject most business owners are quite interested in.  Curtis Alexander, a business growth strategist www.curtismalexander.com wrote an interesting article recently about why some businesses grow and others remain stagnant. 

Alexander proposed in his article that there are only three ways to grow a business: “(1) Get more customers.  (2) Get those customers to spend more each time they buy.  (3) And get those customers to buy more often.”  He goes on to state that “if you optimize each of the three drivers by 10%, you will end up with a 33.1 percent overall increase in revenue.”   Here’s his math:  “If you have 10,000 customers, each buying $500.00 per purchase per year times 2 purchases per year equals $10 million in yearly revenue.  Now boost each driver by 10% resulting in this new math:  11,000 customers each buying $550.00 per purchase times 2.2 purchases per year equals $13,310,000 or a 33.1% increase in revenue per year.”  Whether you use these numbers or use your own business’s numbers, Alexander concludes that “this is the power of small, incremental optimization.”

But wait a minute, you say.  How am I possibly going to be able to grow 10% in each of these areas?  Alexander’s answer is this:  “I don’t know one way to grow a business 100 percent a year.  But I do know 100 ways to grow a business by 1 percent a year.  Add those up and you have a big improvement.  The trick is to take your blinders off and realize that you don’t have to invent anything new.  You just have to do lots of little things better, more efficiently, and more profitably.”  For instance, are you running your most successful ads in many different media outlets?  And not rerunning ineffective ads?  Are you quickly following up new customer leads?  Do you need to experiment with a selling price?  Sometimes increasing a price will increase sales better than lowering a price.  Can you bundle another complementary product with a current offering to increase interest or the impression of better value?  If you held a sales training class for some of your employees, would they sell more as a result?”

Opportunities abound to grow your business.  It means looking for growth opportunities all the time in order to do lots of little things better, more efficiently and more profitably.  The results on your “top line” and your “bottom line” might just surprise you.

Richard Branson, founder and chairman of Virgin Group, said that “my mother always taught him never to look back in regret but to move on to the next thing.”  He said what amazes him is “the amount of time people waste dwelling on failures rather than putting that energy into another project...  A setback is never a bad experience, just a learning curve."  Another way of saying this is if you have a setback or make a mistake, seize the opportunity to be educated.

Harvey MacKay also thinks making mistakes is a great learning opportunity.  He says, “To be successful, you must come to terms with the notion that you will make mistakes.  In fact, you often need to increase your failures to become more successful.  Mistakes don't make you a failure. I always say, if you want to triple your success ratio, you might have to triple your failure rate.

             

Mistakes are okay as long as you learn from them and don't repeat them.  As Confucius said, ‘A man who has made a mistake and doesn't correct it is making another mistake.’   I say it a little differently:  One mistake will never kill you.  The same mistake over and over will.

             

This concept is perfectly illustrated in the story of the fellow who was explaining to his neighbor how he got a burn on his right ear.   ‘I was getting ready to iron my shirts and the phone rang.  I picked up the iron by mistake.’

             

The neighbor replied, ‘Well, then, how did you burn your left ear?’

            

‘The same guy called back five minutes later.’”

Remember, if you learn from your mistakes, one ear will always remain unburned.

No. 2 February 2013

On January 15, 1995, concerned about changes occurring in the outdoor power equipment industry, I decided to write something I could give to my employees to read that would help them understand that change creates opportunities for us to take advantage of as a company.  And that change, as scary and threatening as it might be, could often have a very positive affect on our company.  I want to share this statement about change with you, because I think it is as valid in 2013 as it was in 1995.

“Each morning, over your first cup of coffee, you cringe at the thought of what you will hear this day about more changes in an industry where change seems constant.  You feel comfortable that you’re running your business fairly well.  While there’s always room for improvement, you try to take care of your customers extremely well.  You provide them a service or product that’s good enough for them to pay you a profit for providing it.  You also realize that nobody “owns their customers anymore.”  And that you are only as good as your last performance.  If it was lousy, your customer will simply turn to someone else, so you always try to exceed your customer’s expectations.  Today, you’re confident about your business abilities, but you have some fear about tomorrow and the changes that will most certainly affect you in the future.  How should you respond to them?

In past years a strong and stable company was one that never changed.  Today, a strong, stable company is one that constantly changes; that takes advantage of every opportunity that change presents; and uses every opportunity to move forward in a positive manner.

Alexander Graham Bell best stated what our normal reaction to change is, when he said: ‘When one door closes, another always opens; but we often look so long and so regretfully upon the closed door that we do not see the one which has opened for us.’  You can’t keep your eyes shut, or have tunnel vision.  You have to see and recognize the opportunities as they are presented to you.  And that may take some work on your part.

You recognize opportunities by staying informed about what is going on in your industry.  You read trade publications.  You talk to informed, knowledgeable people.  You attend industry meetings and trade shows.  And you listen better than you ever have before.  Informed knowledge gives you the opportunities; opportunities give you options; and options give you choices.  Then it’s up to you.

Don’t worry, as you ponder your choices, that many may seem of little consequence, or too complex, or that you might make the wrong decision.  One of the most important things in the world for you to know is not where you stand today, but in what direction you are moving for tomorrow.

See your opportunities and make your informed choices.  Then with a passion you didn’t know you had, focus yourself and your associates on relentlessly pursuing your vision.  Only you have the power to make it happen in your business.  Don’t ever get caught looking so longingly and regretfully on the closed door, that you can’t see the opportunities presented by the new door that opened!”

Have you been accused of thinking “outside the box.”  I always thought I did a lot of thinking “in the corners of the box,” which always felt like a good place to be and a lot safer than “outside the box.”   Either way, thinking differently than others can often be unsettling or appear as though you’re challenging the “status-quo,” which potentially could make supplier or customer relationships more difficult than they should be.  So we learn (at least most of us) to restrain our thoughts and opinions and share them at the appropriate times. 

But you must never stop challenging the status quo and thinking about new and better ways to manage your business and improve the quality of the business channel you’re a part of.  As Benjamin Franklin said, “If everyone is thinking alike, then no one is thinking.”  Think about that.

No. 1 January 2013

Did you make a New Year's Resolution for 2013?  Did you keep it any longer than 2012's New Year's Resolution?

It's been a few years since I've even bothered making a New Year's Resolution.  Of course, I'm the guy who's reached the age New Year's Eve means going to bed at the usual time, unless I'm at a party.  And even then it's a struggle keeping my eyes open until midnight.  You may have experienced the very same "symptoms."

But I like New Years Day and always have.  There's something special about beginning the New Year with another opportunity to make a positive difference in the lives of others, whether they be family, friends or employees.  The feeling should be that it's the first bright new day of the New Year.  And that's a good feeling because opportunities abound.  Yeah, we had our ups and downs in 2012.  But that was yesterday.  Just remember not to spend a lot of time looking back at last year, because "back" is not the direction you want to be going in 2013.  Moving forward should be your focus. 

I suppose the most important thing to remember for 2013 is that doing things the same way you have always done them will not change your results for the better.  So shake things up.  Do things better and differently.  If it doesn't work out, try something else.  Have a goal and focus on it for 2013.  You can make it happen.  You can make a difference.  And always remember that smiling is contagious.

"Showrooming" is a relatively new word in the world of retail sales that I told you about a few months ago.  "Showrooming" occurs when someone walks into a retail store, has a clerk demonstrate the features of various products, and then, when they return home or even while they are on the retail floor, they will shop the item they want online, looking for a better price.

Best Buy, in particular, has been really affected by "showrooming."  It is combating this by having sales reps with tablets meet customers as they enter the store.  The sales reps then escort the customers throughout the store as they compare specs on product models that interest them, allow the customers to experience and use the features on the models they like best, and then consummate the sale on the spot.  If the product isn't in stock, the clerk can arrange for same-day in-store pickup using Best Buy's existing warehousing infrastructure or offer home delivery.

Enhanced customer service in the form of knowledgeable salespeople is how retailers are differentiating themselves from online e-tailers.  I can buy an Apple computer online directly from Apple.  But if I purchase the Apple computer directly from a near-by Apple store, I can get all the hand-holding and knowledge transfer that will really make me comfortable with the purchase. 

Because retailers are facing pressure from two directions, Walmart's low prices and Amazon's e-commerce driven convenience, they are reinventing themselves by embracing "omni-channel commerce."  "Omni-channel commerce" aims to deliver a seamless consumer shopping experience through all available channels - i.e. mobile devices, personal computers, brick-and-mortar stores, catalogs, and newer shopping channels yet to come. 

Why am I sharing this with you?  Because you need to know what is happening and what is changing in the retail channel.  When you read that big-box retailers are focusing on enhanced customer service and extremely knowledgeable sales people, you know that you have already been offering these services to your customers for many years.  You already know these are competitive advantages for you.  Focus most on what you do well or should be doing well.  You'll be surprised at the results.

Harvey Mackay suggested in a December Blog that every company should have a Santa Claus attitude.  I wanted to share a few of these Santa Claus attributes with you, because they'll serve you well in your business.  Santa Claus has a great reputation.  He is a magnanimous soul who stands for goodness and generosity.  Santa Claus is a great listener.  He pays very close attention to what you want.  Santa Claus has a great smile.  You know how important I think "smiling" is!  Santa Claus has humility.  He never takes credit for all the happiness he spreads.  Santa Claus has enthusiasm.  He does the same job year after year.  He's a pro.  Wow, let's all be a pro and be the best we can be for 2013.