Elmer - A Natural Leader

Elmer worked for a school in a variety of roles – I’m not sure if he even had a job title...none could do justice to the scope of his duties anyway. The school started with pre-kindargarten and went through 12^th grade.

He took care of facility maintenance, the cleaning and the minor fixin’ to keep everything presentable and functional.

He also drove the bus, bringing the kids back and forth to school as well as on the various school field trips. The kids always arrived safely and were well behaved on his bus.

Elmer tended the boilers to heat the school and provide the hot water. The old boilers were cantankerous, but he would talk to the boilers about ‘acting right’, bang on a pipe or two, and work his magic to keep the building toasty warm no matter what was happening outside.

He could patch up a broken ‘thingamajig’ to get up and running again, and could repair anything without aid of the manual or even the proper replacement parts.

An endearing quality of his was giving directions – Elmer knew how to get anywhere and was happy to share his directions with you in detail...however, he always forgot one turn, usually toward the end of the journey, so we knew that we would have an expected ‘unexpected tour’ of the area before we found the desired location.

However, while his efforts kept the facilities and logistics humming along, Elmer was most noted for his leadership. He had no formal designation as leader, but he was always at the head of any crisis – first one to begin addressing the issue, taking action, creating a plan, helping others slip in to appropriate roles to bring things back to balance and normalcy, and Elmer was usually the last one to leave once the situation had been brought under control.

He always had a good word for the students, asking about their accomplishments, and when needed, a blunt word or two – a verbal ‘kick in the butt’ - to motivate a student that was not striving to achieve their potential.

Elmer never missed a graduation – be it a kindergarten class moving forward to first grade, or a class advancing from lower school to upper school, or the big one – high school graduation. In coat and tie, he was in the back of the auditorium giving a ‘thumbs up’ sign and smile as each of the students received their diploma, and his applause seemed seemed to be the loudest in the hall.

Not surprisingly, when graduated students returned to school for a visit, the first person they would find was Elmer – to share their latest accomplishments, and their appreciation.

He was a leader of men, women, and children, each of whom followed his lead enthusiastically, without need for designated authority or the mantle of a formal title.

Personally, I learned a great deal about leadership by simply following him around, and his influence continues to guide me today. Elmer was a great man, a wonderful individual - so accomplished and meaningful to so many people.

While few organizations have such a special individual as Elmer, many have a ‘go to’ person who helps to keep things running smoothly while helping others grow and learn, all without benefit official acknowledgment or formal authority. Like Elmer, they are natural leaders...support and nurture them.

Want more? See the Final Frontier for insight and ideas.

What You Have, What You Want

An effective way to begin planning almost anything is to list what you have and create a separate list of what you want – once you see this information side by side, breakthroughs can result.

Have-Want works for simple projects like planning your menu and for complex tasks like selling your business. Kicks off your planning with insight.

Imagine you have just done a quick tour of your pantry and find you have some corn-on-the-cob, small red potatoes, a few stalks of celery. Before you head out to the store, you think about what you would like to have for dinner, while looking at the list of what’s available. On your Want list you could list lettuce for a quick & easy ‘whatever I’ve got’ salad, or – seeing the basic components on the Have list for a lobster feast, you may remember the sale on lobster and mussels – lobster feast - a breakthrough dinner idea!

When considering the sale of your business, the tendency is to project the familiar - an operational view of the company – sales, inventory, payables, receivables, depreciated assets, and such. What falls through the cracks are those ’invisible’ things you take for granted – like industry knowledge, customer and competitor activities, intellectual property (processes and how you do business), and the company reputation. Each would have some value or usefulness for a new owner.

Doing Have-Want lists when considering a sale can reveal the obvious and, doing a side-by-side review, can lead to buried insights attractive to a buyer.

Here’s some rules for successful Have-Want assessments for project planning:

• Write down each list – writing it down is a form of thinking which digs deep in your mind and memory – there’s magic in writing out the lists!
• Be thorough, but relevant – in the Have List be sure to include intangibles which have value or recognition; in the Want List include timeframe and if you would work under contract after the sale. Don’t list every nut and bolt in the inventory, but remember to include your iconic logo or company identification
• Be specific but concise – define, not merely describe, the Have’s and your Want’s - could someone else reading the list articulate the value or importance of the item; short, concise, specific narratives transfer the information most efficiently
• Be honest, accurate – do not try to fool yourself – you’re too smart to fall for it anyway; accuracy can be in the eye of the beholder – so write from the other person’s view but with your knowledge...ask someone you trust to read it and interpret what you have said
• Put the Have and Want lists on your letterhead – although the lists start off as a personal exercise, you will likely find the information useful during the sale process; putting something on letterhead transforms notes into manuscripts – and creates a tool to aid in achieving the Want’s.

Clients who were thinking of a simple (and quick) assets sale, discovered they would be discarding 50% + of the value of their organization by doing the Have -Want assessment...a worthy breakthrough.

So, what are you having for dinner – leftovers or a lobster feast?

Join us on Thursday August 28, 2014 at The Power Conference: Women Doing Business for our workshop “The Final Frontier” at Bethesda Marriott Conference Center, N. Bethesda. For details click: www.wbo-mc.com/power-conference

Breakthrough

I was invited to a meeting where the guy at the front of the room was trying to improve group performance by talking himself into a froth. He had invented a ratio and convinced himself that a three percent improvement would mean something, otherwise they were going out of business.

When somebody loses it emotionally, people tend to pay attention, because we’re not sure what he’s going to do next. It’s a protective behavior. However over time, no matter how high the emotional level, people tune out.

I started thinking back to breakthroughs I have seen that changed a company or an industry. They weren’t based on questionable ratios and miniscule improvements. Indeed that kind of noise keeps people from thinking about important solutions.

Back in the eighties, I was privileged to take part in the launch of the first McCaw Cellular One in San Francisco. We didn’t have money, or customers, or a system, or much understanding about what we would do.

We did have an exceptional CEO who expected people to do great things. They believed him, so they did great things.

I remember a meeting about our worsening customer satisfaction. We had supply problems, we couldn’t control our signal, and our competitor enjoyed having us as the much weaker supplier. Grim meeting.

Kathleen ran customer service, so she had the ugly job of quantifying our situation. She did a thorough job, and added some interesting analysis. She didn’t like her job, and no one else wanted it.

Jim thanked her for presenting the situation and pointed out some of the better points she had taken the time to quantify. Then he asked the table what we could do.

There were a couple of behavioral placeholders, but nothing of substance.

Finally Kathleen said she had an idea, but was concerned these older men wouldn’t like it. She stopped.

Jim told her to press on.

Kathleen wanted to change the name of her group from customer service to customer care. The hair on the back of my neck went up. That was the first time I heard that term.

What happened after that was miraculous. Kathleen published the cost per minute of arguing with a customer. We began to promote giving the customer what they wanted (usually a small billing adjustment) and thanking the customer for using Cellular One.

The new Customer Care reps were talking about their better jobs than when they were Customer Service reps.

The customers started trying to deserve our appreciation, so they told spouses and friends. Customer Care was tracking and thanking referrals.

Our customer acquisition got better every week. We were doubling new customers every quarter.

One day Jim called me into his office and showed me the paper. The Chronicle wrote that obviously Cellular One was the highest quality cellular service in the Bay area. The paper stole our tag line! Since it was now in the paper, it must be true!

Mark and the engineers were going through their final frenzy to put up our own cellular network. We were still piping signal through the competition.

We were obviously doing other things right.

That tagline had been percolating since before it was true to remind us what we we wanted.

Jim had been a military chopper pilot, so at least one of our stations was delivered on a mountain top by chopper, with appropriate public and media coverage.

I was working overtime taking our dealers to victory celebrations.

But that one distinction, from customer service to customer care was a snowball that started an avalanche.

I thought of Kathleen when the computer scientist from Comcast told me that the reason I couldn’t get internet one morning was because my computer was too old. Go buy a new computer. I finally found out that some server cowboy had erased my address file...but not my billing file.

Or when the Verizon salesman called the cops because he didn’t know how to sell us a new phone. His boss was even more embarrassed after the cops showed up.

Most of the time we can’t tell what the best solution is going to be, but overwhelmingly it hasn’t been studying made up numbers or inconveniencing customers.

Check out Tips 4 The Big Chair

The End of Science

Charles Murray introduced me to the idea in Human Accomplishment: The Pursuit of Excellence in the Arts and Sciences, 800 B.C. to 1950. Now that the Periodic Table is filled out, and so many overarching theories are proven, what’s a producing scientist to do? 

Ever since I read that, I’ve noticed how few scientists are actually doing science. Most are teaching or opinionating, or manipulating policy. 

This week I read The End of Science: Facing the Limits of Knowledge in the Twilight of the Scientific Age by John Horgan, an ostentatious display of mastery by an author uniquely qualified to ask top scientists, “What is the future of Science?” 

For the last 25 years he has been interviewing noteworthy scientists and publishing those interviews, principally in Scientific American magazine. This book is a reordering of many of those interviews around a single premise, long on examples that lead to an optimistic, well reasoned conclusion. 

Along the way there are some valuable observations, after all, he has made a career out of talking with the best of the best. 

Earlier this week, I was involved with beer and the question came up, “What is the relationship between science and engineering, especially in education?” I know many busted scientists who look down at excellent engineering, glaring that if you have to ask, you are obviously too stupid to know.

So when I stumbled across this, I wanted to know.

Horgan records that the difference between science and engineering is that the scientist seeks what is true, while the engineer seeks what is good. p258

Or, as I see it, calling a tomato is a fruit is true. Not putting a tomato in a fruit salad is good. That’s useful.

Another useful point as I’m being bombarded with pseudo-scientific propaganda and opinion is:

“...verification and validation of numerical models of natural systems is impossible.” p202 Ooh, good one!

As I have written, a model is a simplified version of reality, useful when it allows you to predict what happens. Every sales manager I’ve ever known has confused the model with the reality. When the model is no longer accurate, build a better one.

A more elegant stipulation of model hysteria is No matter how hard you do the wrong thing, it never quite works.

Horgan is properly in awe of his subjects best thinking, and reverent when it has proven true and useful. He has a better grip on the role of irony and criticism than his subjects, and he knows that the big ideas seemed fanciful when first introduced.

When confronted with energetically delivered caca de vaca, he doubles down on reporting what was said, letting the subject fall on its own. Doing many major interviews gives Horgan confidence to trust the process.

The last few pages gave a new example of the future of science that was earned through all the interviews.

Many years previously he found himself in a rigorous thought experiment that showed the future of science. He was somewhat hesitant reporting the story, as he thought it was unique. 

As I read his story, the hairs on the back of my neck went up. I had had a similar experience forty years ago. I wonder how unique the experience really is?

The lesson for those considering the End of Science is that science has never been “out there,” but always “in here,” between the ears. Realizing that, I thought of Horgan’s interviews in the book of scientists who rued that they hadn’t had a good idea to follow in years.

Which explained the education, opinionating, and policy manipulation of so many former scientists. As Waylon said, “It ain’t love, but it ain’t bad.”

And for those wondering about that future? Well you can come back baby, science never forgets.

See from Intellectual Understanding to Daily Practice

From Intellectual Understanding To Daily Practice

I find that most people know something about most subjects. To have someone make a big “aha!” isn’t part of the daily routine.

Yet the value is seldom in intellectual understanding, but in daily practice.

Years ago, I was running a weekly Sales Lab for some legendary sales professionals. The program was sponsored by a financial services provider who first wanted his people better, and then found that by opening enrollment they were getting a constant stream of referrals and new customers.

Over the years, we kept doing the same five things every week and everybody just kept getting better.

At the same time, I was consulting to a venture capital fund and the managing partner heard about the weekly meeting and wanted to attend. He was colorful, charismatic, and always behind in his sales.

He was bright and verbal, and many of the other participants already knew him. He jumped right into the exercises.

After, I asked him what he thought. He said, “I enjoyed it, and think I would do better in the advanced class.”

General laughter. The professionals knew there was no advanced class. This was like a martial art, where you just keep getting better at the basics.

Mastery is when my customer says, “We’ve always done it this way.”

When I was living in Marin County, one of my clients was an Aikido adept. He had been faithfully going to the dojo for decades.

I asked him how he measured the value from his practice?

He said, “Years ago, I was bicycling down the road with my baby daughter in the front basket. I hit a pothole, and the front of the bike collapsed. I was thrown over the bike, and was able to catch my daughter before she hit the ground.”

Mastery is not knowing how to do something. Mastery is performing when required.

Now, About Work....

Order Out Of Everyday

Jack and I were comparing notes. We are working with several new companies, and a first step is to figure out what we have to work with.

Early conversations tend to go on and not provide much direction, except to wear everyone out.

However, recapping those conversations on a single sheet of paper sharpens everyone’s focus. Put their logo on it, and they have an official document.

When we start to focus on how that first document could be used to promote the company, we get specific new information...because it wasn’t important before.

Just having a tangible tool defining what the owners want and what they are offering creates enthusiasm and a desire to move forward.

I notice two benefits from these one page recaps. One is cultural and the other transactional.

We have started defining a culture that people recognize about themselves, and we have something other than our good looks anyone can take into a meeting.

What we just figured out today is that these aren’t enough. If we stop improving the paper, all activity stops. I can understand why someone might not be able to create a new document, but just today I realized why the customers won’t build an improved document. I’ve been seeing and ignoring that for over thirty years.

What they need is the discipline of future focus, that they set aside time to keep their process moving forward. I realize we have been providing that time to focus with our weekly meetings. Take that away and tomorrow gets canceled due to lack of interest.

How long do you keep moving the ball down field? Until you score, or you find a better game. Waiting seldom improves a situation.

Does this get you thinking? Try The Final Frontier!

Three Project Models

Last night we had a large crowd for The Final Frontier at the Association of Information Technology Professionals. One of my teachers had been reading ahead and brought a thought paper about reforming our economy.

Last time around, we were building super computer environments for modeling complex technical processes, and the results were astonishing. Since that time he has been working at a national level to improve our technical capabilities in state-of-the-art engineering.

He reminded me of a lesson he taught me years ago, that a government group is different from a corporation, in that a government group has a mission. Accomplish the mission, stand down. A corporation is supposed to turn a profit and continue.

When a government body is failing at their mission and starts trying to morph to “make a profit” we figure they are truly lost.

Anyway, his proposal called for rallying an infrastructure first, then proceeding to create results. He has been working with a lot of government recently, so I could see where he got the idea. Personally, I am weak at building effective infrastructure (who isn’t?), but since I’ve come to accept he’s smarter than me, I woke up this morning changing my thinking.

So, one way to start a project is to build an infrastructure, get budgeting, recruit troops and march off smartly. Nice work when you can get it. Reminds me of Jefferson and Madison creating the Navy.

The second model comes from my construction experience, and dovetails nicely into software development, Architecture, Design, Execution, and Evaluation. I wrote about it in 2009, after creating a major improvement in Evaluation.

However, I have seen that methodology fail spectacularly, and until last night I hadn’t figured out why.

The planned workcycle is most valuable when you are doing variations on a theme, the homebuilder building his 20th home, the software developer creating his 50th database. The workcycle is about improving the efficiency of projects that are already understood. They come apart when you insert unknown materials, technologies, and people.

There are still a lot of these kinds of projects out there, and there is also a third valid model, and last night I realized when to use it.

Back when the internet was optional, I was selling a lot of COBOL, largely by attaching it to the internet. My company wanted me to go across country for an internal boondoggle to think lofty thoughts, and when management got tired, they left the building, and the worker bees began experimenting with some adult beverages.

At some point I idly asked what was the shortest COBOL routine and my (several) technical advisers settled on three lines, which even I (a mere salesguy) could do..if I was worthy.

A laptop was booted. Green screen. Brackets. Three line majick incantation. Then “go.”

The computer thought for a bit and replied, “Hello World.”

I was worthy!

And that’s the third project model.

A simple prototype proving the capabilities required. Call it The Bar Band Model, the Artillery Ranging Model, or the Towel Cape Off The Garage Roof Model, a quick prototype is an excellent way to prove or disprove an hypothesis, and also has the increased value of allowing users to better specify what they want based on what they learn seeing the prototype. Sounds like an Open Source Model.

You can go here for more Tips 4 The Big Chair!

Truth

As the story goes, when asked by his father about who chopped down the cherry tree, George Washington said “I cannot tell a lie, I did it with my little hatchet.” While this actually did not happen, throughout his life, Washington demonstrated a strict adherence to telling the truth, especially to himself.

Historical accounts tell story after story of Washington going beyond the known and established to undertake new and innovative projects – like the octagonal barn for thrashing wheat, or rotating crops to keep the fields vibrant. He was absolutely clear about refusing to permit an imperial Presidency.

These examples show Washington as an innovator, an entrepreneur, who took concept to plan to execution, and demanded knowing the truth about it at every stage (concept = potential; plan = risk/reward expectations; execution = resulting level of success).

Noticeably missing from history are stories of ideas and projects which did not succeed. Personally, I find it impossible that even Washington could have gotten it right 100% of the time.

What I do believe is he truthfully assessed the stages of the concept-plan-execution path and stopped a project if the result of a phase was insufficient or the risk too great – based on sticking to the truth rather than relying on a dream, a wish, or a hope to achieve success.

...And he learned from these experiences.

In the French and Indian War, Colonel Washington acted on the truth as he knew it – that the French soldiers and Indians were a small, ill equipped force, so he chased after them. Turned out that they were a much larger superior force with plenty of supplies and ammo. Washington led his troop back to Fort Necessity, where he fought a major battle and was forced to surrender to the French.

The truth as he knew it, from earlier observation and gathered intelligence, was not correct...when they chased the other soldiers and warriors far away from the protection of the fort, he learned tragically that they were a vastly superior force and well supplied. Seeing that he was impossibly outnumbered, Washington surrendered.

While this reflects a military failure by Washington, it is clear that he continued to tell himself the truth as circumstances changed, unlike General Custer many years later, who, because of faulty intelligence, refused to acknowledge the Indians were a superior force - and he tragically lost the battle.

Washington learned well from this defeat and was never again forced to surrender during his military career – like the carpenter who measures twice and cuts once, he sought intelligence from several sources and used this for better strategic battle planning.

As leaders, owners, or entrepreneurs, we can find ourselves in a situation where reality is a bitter pill and telling ourselves the truth is painful.

If a project is showing signs of failure, or a service/product line is meeting the needs of fewer customers, or the market price for your company is much less than you had expected, the temptation may be to rely on a dream, wish, or hope for a miracle outcome.

However, like winning the lottery, while miracles may happen...it’s not too often and not to you. Taking action based on reality (the truth) is ultimately a better choice.

Truth may not make things easier, but it can increase the odds and magnitude of success, compared to the alternative.

Facts are a building block of truth, and John Adams captures the point about sticking to the truth quite well in his quote:

Facts are stubborn things; and whatever may be our wishes, our inclinations, or the dictates of our passions, they cannot alter the state of facts and evidence.

Want more? See the Final Frontier for insight and ideas.

Book List

We are living in a time of social and economic reinvention. I think it will be remembered as an internet powered renaissance.

Jack and I spend a lot of time figuring out what is happening, exhorting each other to dig deeper.

Often when we are talking to clients and tell them what we have learned, they want to know where they can go learn it. Providing references and not forgetting was the reason for starting our book list.

The book list started as a document on a computer, then we were printing copies and giving them away, but hyperlinks on a piece of paper are hard to work, and soon adding books, videos, and seminars meant we were having an updating problem. That page was about to go to two, and was turning into an administrivial beast.

A couple of months ago I was in a board meeting for a group that had been unable to create an event landing page that would enroll attendees. There was a tale of woe about why, but the important thing was that the event was coming up and no one was learning about it or signing up.

During the meeting, I looked up at the screen behind the president of the organization and saw that he was constructing a landing/enrollment page using Google Docs...while running the meeting. He had it done in 20 minutes. It was a concrete example of what was required, and I figured there must be a way to append the doc to a website.

Fast forward a couple of months and another organization is falling behind publicizing an event. I didn’t know how to explain the Google Docs solution, but as we were coming up on the event, I wanted to lead rather than exhort.

I took our Book List, and pasted it into a Google Doc. Then I took the blog posts we had written about some of those books and linked them. That way someone looking would read what they had heard in a meeting.

There were other descriptive sources for the entries, so I added reviews that mentioned what I thought was important.

Jack suggested we use a link shortener like bit.ly/SLBooks to make it easier to export.

By then, we had something to publicize so we put links on our Plus pages, my website, Sales Lab website and blog. Now that we have created a new asset, we are looking for other places we can use it.

Want a whiff of the oncoming future? It’s good! Especially for those who are prepared! RSVP for The Final Frontier  at the Association of Information Technology Professionals,  6:30 pm, June 9th, at Alfio’s  in Chevy Chase. Please join us!

The Arc Of The Story

There are a lot of management books published every year. Some are great, some are good, many are awful.

Creativity, Inc. : Overcoming the Unseen Forces That Stand in the Way of True Inspiration by Ed Catmull and Amy Wallace is not about organizational development, so much as organizational transformation. For many readers, that will be like trying to see infrared, but if you are careful and attentive, you can learn a lot.

Ed Catmull wanted to do a computer generated animation feature film. That took him over twenty years. He started as a Unix programmer at the University of Utah building tools that were shared in the community. He was doing open source before open source.

That led to working for George Lucas to provide computerized backgrounds for Star Wars. He was working at the edge of what supercomputers could provide feature films, but it wasn’t enough, yet.

When Lucas had to sell his computer operation, they were almost sold to twenty companies. Finally, they were bought by Steve Jobs, post Apple, and so began a twenty five year partnership, the longest Jobs had.

Now I read the tech press, Walter Isaacson’s Steve Jobs  and Haunted Empire, by Yukari Kane.  I even worked for Steve Jobs as an organizational transformation consultant, until he got fired from Apple, before he met Ed Catmull.

I never bought into the Steve Jobs is a genius, Steve Jobs is an asshole reputation the media loved. He worked me hard and appreciated what I brought. For a time we were moving mountains.

Ed Catmull worked constructively with Jobs for far longer, and sees a better arc of the story, about a talented person who kept getting better at using his gifts. I like Ed Catmull’s appreciation of Steve Jobs. It is better, more nuanced, more valuable, than anyone else’s.

While he was in that relationship, he was running a supercomputer company called Pixar, and they quickly sold all the installations they were going to sell. So the same people who were building and selling the system became the best users of the Pixar system and did computer generated short movies that won Oscars and other awards.

Next they tooled up and created Toy Story,  the first feature length computer animated film. Ed Catmull had overrun his vision, and it was way more profitable than selling computer systems.

Catmull talks about the letdown of achieving his life work and formulating a next vision, to build a company that would do incredible work and nourish the people in the company. Once he defined it, he set out to build it, keeping the same key players while constantly expanding the team.

I noticed that he has been with the same posse for over thirty years. Their situation kept getting better, but people were by and large not replaced, they were developed, and kept on getting better and meeting new challenges. That’s an heroic perspective to emulate.

One of the points he keeps coming back to is the arc of the story. A great film needs a great story. He writes that if you give a great story to a mediocre team, they will screw it up. If you give a mediocre story to a great team, they will either fix the story or develop a better one. This book is a great story

A key message of the book is that all movies originally suck. The work of the team is to make them not suck. And he provides gripping stories of how that was done for every Pixar movie. This is one value of the book.

Page 103 - The difference between criticism and constructive criticism is that with the latter, you are not just criticizing, you are constructing.

Page 141 - There is a difference between reviewers who pounce and kill and reviewers seeking and promoting good ideas. Negative feedback may be fun, but it is far less brave than endorsing something unproven and providing room for it to grow.

Page 171 – Hindsight is not 20-20. We barely know what happened in our past. We only see a small part of what happened. So if you can’t see the real past and you can’t know future, the best strategy is to behave well, work hard, and not kid yourself.

Page 203 – How do we enable our people to solve problems is the correct perspective, not how do we keep our people from screwing up. The “keepers” can never see that they don’t contribute.

He has some awesome stories of casual heroics from the members of the team, how a mistakenly erased feature was not lost, how six months of rework was done over a weekend. Catmull takes a fierce pride from belonging to an organization that does heroics regularly. So does everyone else at Pixar.

But wait, there’s more!

The Promised Land  for animators is Disney Studios. But Disney Animation hadn’t done a successful feature in over a decade. Disney Animation management decides their most original work will be making sequels to Pixar movies.

Relations get frosty. Finally Steve Jobs tells Catmull and team they have to sell Pixar to Disney. Pixar needs Disney’s marketing and distribution capabilities.

There is a new CEO at Disney, who has been through two mergers, one good and one bad, who says this will have to be a good merger, otherwise the money is wasted.

Ed Catmull becomes president of both Pixar Animation and Disney Animation. The game becomes can he and the Pixar team bring their magic to Disney Animation: from building a successful culture to installing a successful culture...while keeping Pixar moving forward?

That is not easy, and the short answer is that they do. Both teams are winning awards, creating top grossing animations, and making money. To find out how they do this, you’ll have to read the book.

Ed Catmull reinvented himself at least three times, and brought his team along. Pixar’s celebration of Steve Job’s death had me crying, but I cry easy. If there was ever a CEO who saw through the bullshit and bravado to an honorable course in a changing environment, it is Ed Catmull. If you’re serious about being better, this is a book to read.

Looking for more? Check out The Final Frontier.

Doing Things Right Or Doing The Right Thing?

I was working with an organization and ran into a strange situation. The head of their skunk works was a hero for doing things right. He was an inspiration for having his team working effectively, following the right order of build, making lists, all the stuff I treasure.

The problem was nothing was coming out of his group. They were working hard, getting sweaty and loud, and were an increasing expense.

Finally, he left, being unable to “get the support of management (the fools).”

The Druid who replaced him was less formal, less rigid, and told good jokes. He looked at the two page list of projects, and abandoned most of them. A few were folded into other efforts.

In two weeks his team was shipping finished prototypes. Turns out they weren’t finished, because by supplying something that worked, we could see what else was needed.

And those improvements were incorporated in less than a month. We were shipping new products!

Trying to define the difference, I realized we had gone from doing things right (a necessary and good policy), to doing the right thing, which was cheaper, more valuable, and easier on the workers.

When you are generating more heat than light, are you doing things right or doing the right thing?

Here is more About Work.

Active Or Passive Investments?

I am working with a company owner who is getting himself ready to sell the company which has been a major focus for him for the last thirty years.

As we were putting his story together, he shared his memories of great things he did to get it off the ground and grow back in the early days. More recently he’s been hammered by outside forces, forced to take a different posture. Some years you’re the dog, some years you’re the hydrant.

Seems that exiting owners take the view that the history merits a premium price for an asset that they are passively managing.

Buyers are looking for an active, or even leveraged opportunity that they can control inexpensively.

The transaction is reconciling those two viewpoints.

Sales Lab Resources – Winning is fun!  

The Final Frontier

We are embarking on the greatest business revolution in 4 generations. It affects our whole economy.

The biggest change in ownership since WWII is starting now and will continue through the next 15 years. More than one half of small and medium business in the American economy are owned and managed by Boomers, and will have a forced change of ownership.

Who are they? Many current business owners have their personal fortunes, the scorecard of their careers, tied up in their businesses. They must find a way to get the money out of the business or assure its continuing viability, or have an unsuccessful retirement.

Do you know business owners in this situation – can’t figure how to get their money out? What do they need? Owners are looking for credible solutions.

We find that the keys to past success are usually the owner’s point-of-view and the culture of the company. We have found that outside solutions seldom work, they aren’t credible to the people doing the work, and they often have never worked elsewhere.

How do you begin creating a solution to a new problem? You should probably start with a common definition of what you have and what you want. Just defining those two often shows available solutions that were previously ignored.

We worked with owners of a technology distributor who wanted to sell the assets of the organization, had a figure from a recent audit, and hoped for a quick sale around that figure. We talked with them about what are the assets? In addition to office equipment and inventory – what else -  entity and name, customer records, sales process, industry knowledge?

Asked what they wanted, the owners said quick sale at top dollar. Which is primary – speed or price?

As our conversation expanded, the owners defined what they were selling (the complete entity, but retaining another separate corporation), had identified potential buyers (their knowledge of the industry could be useful to the buyer for transition), and that a couple of years was OK to get a better price.

Just getting the conversations and revelations took 90 days.

For a nonprofit teetering on the knife-edge of solvency, the conversation lead to determining a merger was a desirable choice strengthen the organization and keep the mission programs operating, then find partners, complete the combination of the two entities. The entire process took almost 3-years.

A contractor got 100% of their revenue from government contracts when we began the conversation about getting money out for the owners. What do you have, what do you want? The results over an 8-year period was to increase government revenue threefold, reduce government contracts to less than 30% of total billing, and to sell the organization for several multiples of its initial value.

A successful future begins with a conversation.

Rules of the road? Click: Selling Out 

Are You A Reader?

Do you have a program, or some method for your reading?

Why?

Do you have goals for creating value from your reading?

How do you keep score?

A couple of readers were talking last week about about our habit. We’re thinking it’s getting less popular.

The next day I was musing about the similarities of the people in the discussion, and realized:

I’m not just a reader.

Because I’m a reader, I’m a thinker, and because I’m a thinker, I’m a writer. Because I’m a writer, I’m a reader.

And you?

Enjoy a Kepler Moment.

Is Your Company’s Culture Spooking The Buyers?

At the Emerging Markets Forum put on by the Smith School of the University of Maryland (my alma mater) many eye-opening points were raised about confusion and uncertainty of both parties in doing business together.

I came away with two conclusions:

• much of the friction (failure) is due to a lack of understanding the business culture by each side
• this applies equally well between seller and buyer here in the USA when owners are selling their companies.

Most of us who started a business have a collection of practices, processes, and procedures for operating the company and making sales that works for our company. They are a hodgepodge of what we have learned over time, best practices adopted/adapted, regulations/industry requirements, and what satisfies the customers’ needs. This collection, combined with how you and your employees go about the day-to-day tasks, comprise the culture of your company.

Do you serve the customer, or do you suffer the customer; do you have SOP or do you rely on an “everyone knows what to do” philosophy; do you trust your employees and customers or do you require extensive documentation and supervision/approvals? These and other characteristics reflect your company’s culture.

The culture of an organization is a contributing factor to its success and may be looked on as the oil which keeps operations and sales running smoothly. However, when that is not the case, you were there to tweak the practices and your company culture absorbs the changes and moves forward.

Enter a serious buyer.

Once the review of the financials and other documents about value of your business has shown that your company is a solid prospect for acquisition, the buyer will want to see the “Your Company How-To Manual” - the what, how, and why of running this business, making sales, and generating profit.

Of course there is no physical manual containing this information, but the buyer is expecting to see sufficient documentation about your business to understand on an applied basis how it operates.

Whether the buyer is from the same industry or comes from outside it, they will want to assure themselves that operations and sales practices and processes can continue without you.

This is where the confusion similar to that in emerging markets comes in play. The culture, operations, and sales – which have served the company so well over the years – has had a central element – YOU – as the hub of the wagon wheel. This structure is strong and works smoothly with the hub in place, but when it is removed – which is the effect of the sale – the structure is unsustainable...unless a replacement hub is available.

The buyer must be convinced that the company can run and prosper without you as the hub, and the loss of some or all of the key players on your staff. Spending time talking about the how and why of running the business can help dispel confusion and concern, to some extent.

However, the more that practices, processes, and SOP are documented, why principal tasks are done a particular way are explained, and how the customer relationships are built and maintained, the clearer the picture the buyer has of sitting in the big chair operating their new company. Offering stories which demonstrate how the culture fits in this picture in a positive way—for the Ritz Carlton, a story would be about empowering every employee to spend up to $X on their own initiative to address a guest’s complaint/concern, which results in one of the highest guest satisfaction rates in the industry. Such stories show the how and why – which reduces the mystery and potential barrier to completing the sale.

A successful sale is the culmination of finding a serious buyer, sound documentation, proven practices, processes, and procedures, a supportive culture, and illustrative stories that convey the what, how, and why of operating the company. A sale begins with preparation.

Your career as a business owner end game – The Final Frontier

The Best Tool

Starting a company?

Selling a company?

Trying to resolve a thorny problem?

Trying to UNDERSTAND a complex problem?

Make a list.

Seriously, start writing a list. In the last two days I’ve been amazed how half a dozen impasse situations were improved by somebody writing a list.

Now because I’m a hotshot consultant, let me improve on perfection.

For two of the lists, I was in meetings when someone asked for my thoughts. I was hungry, or had a tee time, so I said I would send it to them.

Right there in each meeting, I started making an outline, based on the discussion leading up to the request. That wasn’t hard, everybody else was interrupting each other.

I left, went on golfin’ safari, and forgot about them. Came back a week later, and there were my outlines, looking up at me, expecting further work.

My process is to start from an electronic stationery template, improves my vocabulary, keeps me from using a contraction for firetruck. I also figure anything I write will be public soon enough, so better to establish who wrote it.

In each case filling in the outline took less than an hour and the result was a new area defined, with reasons and recommendations, assets and methods. Sent each off to the customers.

Three other lists were sent to me, from Maryland and California, as my associates define what they see, hear, and think. There weren’t any big words or suspect statistics, just recall, observations, and recommendations.

I was privileged to be on the distro list, because these guys are sharp. I realized we were all creating value just by formalizing the conversations through a second draft. As Jack told us, “Writing is evidence of thinking.”

That’s five, I promised six.

What’s the best way to create a blog post?

Don’t miss The Final Frontier. Learn where we are going, where few have gone before.

The Optimal Time To Sell

Jay Leno had an ad for Doritos, “Crunch all you want, we'll make more!” That's for an unlimited product. Especially true when the cost of another copy approaches zero.

What about a one of a kind product? The common wisdom is that prices for art go up after the artist dies. Turns out the artist has to be famous, needs to die prematurely and unexpectedly, and has to leave a growing market.

What about a product, service, or offering that is viable, has an established market niche, history, customers, and competition? I think the model is selling a car you no longer want or need.

First, sell with market demand. If you have served a niche that is no longer as attractive, what has replaced it? Who is taking your money? Why can't you look more like them?

Second, get detailed and shiny before sale. I'm always surprised at the list of things that weren't worth changing for day-to-day operations that emotionally affect buyers. As one operations manager said exasperatedly, “Men can't see anything!” And she was right, so her office got paint and carpet, which moved us from no interest to completed transaction.

Get over being embarrassed. Employees, customers, and vendors all need to hear your best story for making the changes you are planning. If they are adversely affected, I usually find value increases by learning and addressing their concerns.

Don't expect to have your transaction completed with an unknown source. Document everyone you know who could care. Prioritize your list and figure the best way to approach as many as make sense.

Go long. As you make your list of all the usual suspects, figure out who should be on that list, prioritize them best first, and start building your offer to the most important choices. After a couple, you can reuse what you've built to approach as many on the list as you need.

Selling a car is not the same as owning a car. There are new skills that are usually quick to learn and can add to your remaining enjoyment even as you know your time with it is limited.

Take the time to get best value.

Discover the relationship of Truth and Time.

Does Business As Usual Attract A Buyer?

There are a multitude of first things that need to be done when you take over in an organization as the new person – especially if you are at the top of the org chart.

When I was elected president of the board of a country club, I immediately talked with the key staff and department heads, influential club members, primary vendors, and community supporters to get a good view operations and the business health of the club. I also looked at the books and administration files as well. While on the walk-about, I shared my views and thoughts about governance under the new administration.

When I took over operations as President and CEO of the National Captioning Institute, a promotion from within the organization, I spoke with the key staff and department heads, board members, major clients, primary vendors, and the auditors. This gave me a broad view of how effective the operations were and gave others the chance to see me in this different role.

In both cases, most operations and administration elements were in pretty good shape, but there were several items that had slipped, resulting from the casual and comfortable nature of long-term relationships between staff and external resources. Like contracts which had expired but were extended by handshake between parties – works fine while the same players are in their respective roles. However, when that changes, there is no documentation of the current contract provisions, and the person(s) with specific knowledge are elsewhere.

In a similar situation, the standard operating procedures (SOP) for the organization most likely have changed in practice but not been written down – everyone knows what changed when it happened – so no urgency to document the changes, so the task of writing them down gets further and further down in the pile of things to do. The problem comes when the players change and specific knowledge of SOP goes out the door.

What I have found in the sale or purchase of a company, a division, or a product line, more often than not, it is these casual agreements and undocumented changes that delay or kill the deal.

Unless, or until, the operations and administration can be substantially documented, prudent buyers will not go forward, because there is no assurance that the informal, handshake deals will convey with the sale. What holds the buyer back is fear of a situation where a reasonable deal becomes nightmare due to negotiation conditions and agreements before the ink is dry on the purchase agreement.

When working with owners, before taking the business to market, an initial step is housekeeping - dotting the “i’s” and crossing the “t’s” to assure current documentation and contracts are complete and readily available for the buyer’s due diligence. This project also helps the owner bring into sharp focus relationships and resources so much a part of the operations that they are all but invisible. What has been disrupted by the Internet – how can we capitalize on a new approach?

Once this is cleaned up, the owner can work on developing materials which present to the prospective buyer the benefits of owning this organization.

Business as usual can have too many ‘just because’ elements, which will spook a serious buyer. Better to convert them to ‘here’s how’ before setting up the sales tent.

What lies ahead for the owner – The Final Frontier

Models and Actuals

Last week I read 2nd Machine Age, which pointed out that Moore’s Law, that computing power per cost doubles approximately every 18 months and has been chugging along for 60 years, is not a law, but the sum of thousands of heroic breakthroughs, a lot of people doing good work. Every time some theoretically imposed boundary was reached, someone else would come up with a different solution, eventually improving chips, architecture, software, communication and other workarounds to maintain the progress of that “law.”

There have been numerous opinion pieces announcing the end of Moore’s Law for every impending reason, mostly from people who didn’t understand ESR’s Linus’ Law,  that “Given enough eyeballs, all bugs are shallow.”

I was thinking about that as I was reading some analytrash about the end of prosperity. Seems to me that there is a whole class of mumblers who create their place and prestige by predicting, “You’re gonna drop it!”

That’s not a bad prediction, because once the ball is in the air, one of two things is going to happen, and if the ball is caught, who’s going to remember the prediction? Fans care about accomplishment.

It’s also a good bet that the predictors shouting “You’re gonna drop it!” are not the ones sprinting to make the catch, so I guess it’s their best contribution.

What bothers me is the “woe is we” troupers often seem to be backing themselves into positions of political power in a variety of organizations, with truly embarrassing results.

I read someplace that one of the precursors of the Renaissance was the Black Death, which killed a third of the European population, largely in the populated centers of power, which opened up a lot of positions that were filled by people too inexperienced to know who couldn’t succeed.

Success is not some overarching trend. It’s a group of people who find a way to create value in a specific situation. As much as those in authority would like to control success, that is not their function. Or it shouldn’t be anyway.

Dune Leadership Lessons. FTW!

The Internet Tool– Faster, Cheaper, Better Results

OK, it is clear to me now – the internet is not a passing novelty, it is a creation tool of considerable versatility and depth, and fosters creativity at every turn. IaaT – the Internet as a Tool is here to stay.

Back in the ‘90s, my organization went through an image update – a new logo, and a branded, coordinated image to go with it. Our PR firm took on the project and immediately dedicated a design team to us.

At the time, we had a long established and recognizable logo of large lowercase initials and at the end, a stylized TV screen shaped into a caption balloon with an accent pointing down.

Numerous meetings were held – gathering input about likes, intent, style preference, and the like. Then the choice of color pallet – more meetings: how does this combination strike you; what about this color and this font, graphic, paper finish and color, and much, much more.

The result of the project after five months of work and numerous sketches, artwork renderings, and final art, was a new logo. The distinctive old logo was replaced by a three line text box with the organization’s name displayed - one word on each line in a pretty common sans-serif font (like Ariel) and a color scheme of dark purple and green with yellow letters. The colors reminded me of a circus and the logo suggested a vision of an animal cage. The project cost many thousands of dollars.

In contrast, last year I changed the logo of the Leadership Breakfast of Maryland – it had simply been the name in block letters. For this project I went to the internet and found many sites which do logo design and several that design logos using a competition framework.

The competition sites involved numerous artists submitting one or more designs within a strict timeframe which the client (me) could review, narrow down to the favored ones, and send feedback about what we liked and what we wanted changed.

The project started with a questionnaire about our business, mission, vision, color preferences (and avoidances), style likes and dislikes, and a general description of the image or message the logo should convey.

When we returned the questionnaire to the vendor, a three-week clock started, with the first week alerting artists of a new competition and sharing most of the information in the questionnaire (not my direct contact info). Later that first week I received the first designs - 10 initially and the flow of new logos increased dramatically up to the end of the second week.

I found several logo designs that interested me, and gave a critical review of likes and changes – sent them to the vendor who forwarded the comments to the artist. Within a day (often within hours) I would receive revisions to the logo and additional designs to consider. Then another feedback cycle followed by revisions and several alternative designs.

The project had a strict timeline – 10-days for initial designs, 6-days for refining the design, and 5 days to finalize and choose the winner. The process generated over 80 logo designs by 40+ designers from all over the world. The project start to end – when I received the graphic file with several sized logos in full color – took a total of 21 days. The cost was about $300.

The contrast between these two projects was startling. The traditional approach of one designer, several consultants of various types, 5-months, and thousands of dollars for a trendy result in the ‘90s vs. 40+ designers competing for a successful design, 3-week timeframe, and $300 in cost.

This is a vivid example of how the internet has disrupted traditional consultative approaches by using gaming theory to involve a larger number of players who seek to be a part of the project and compete on a winner take all basis. In addition, this new meme actively includes the client (me) in the design development.

The disruptive innovation of IaaT leads to paying for results instead of time logged, and getting a wide variety of ideas and possibilities from talented professionals, in an accelerated timeframe, at modest cost.

End game in sight? Selling Out is a good wrap-up.

Gold Star

I was working with a Venture Capitalist who observed, “I hate when I get three quarters of the way through a project plan and see a gold star with a footnote that says, “Breakthrough required here.”

Hunh.

Me too.

Here’s another secret for Cutting Development Time

The Second Half Of The Chessboard

The story goes that the inventor of chess showed it to the emperor, who was mightily impressed, and asked the inventor to name a suitable reward. The seemingly modest response was one grain of rice on the first square, then doubling the rice on each subsequent square. When it turned out that many grains of rice had never been grown, the emperor had the inventor killed.

Old story.

Ray Kurzweil (p. 46) observes that while numbers do get large on the first half of the chessboard, we come across these in the real world. It’s the second half of the chessboard where they get crazy unbelievably big.

The 2nd Machine Age says we are entering the second half of the chessboard right now.

The greatest shortcoming of the human race is the inability to understand the exponential function. Albert A. Bartlett (p. 39)

Think of a line that hugs the bottom of a graph going right, until suddenly it shoots straight up the right side. If you change the up/down axis from an arithmetic progression to a logarithmic progression, the graph becomes a straight 45 degree angle. It’s the growth graph of most successful startups, healthy adoption of technology, and many other graphs I see every week.

So what?

As we enter the second half of the chessboard, we should understand that some “rules” change.

The book shows how Moore’s Law (that the power of computing per dollar doubles every 18 months) has been true for 50 years, but it’s not a law. It the result of thousands of scientists and engineers knocking over every barrier and finding new solutions that has kept Moore’s Law on track. Yet people see it as a law, like gravity, because that is the simpler way to think of it.

If we have billions of sensors available, and billions of thinkers available, successful projects are going to make effective use of both. The book says there are over 7 billion people with over 6 billion mobile phones. In Darwin’s Cathedral, David Sloan Coffin, one of the first evolutionists, thinks that the organism is not the individual human, but humankind. Forget the behavior of individuals, keep your eye on the species.

Which means that this internet thingie is a reordering of our species communication. I guess I knew that, but didn’t realize what it meant.

For one of Jack’s projects, the Leadership Breakfast of Maryland, he wanted a great logo at a good price. He found a site which helped him define his situation, specify what he wanted and then turn it over to a community of hundreds of designers. He selected his top contender, who did some tweaking and was done. The process was fast, inexpensive, and high quality. Jack never met any of the people involved.

The 2nd Machine Age gets quite specific about the jobs that are currently machine replaceable and therefore have little value, those that will soon be machine replaceable and therefore have slightly better value, and those that will not be machine replaceable and therefore have a solid value going forward. Looking at their examples, I see they are true, and for me there is value in now seeing underlying reasons why.

We are puzzling out a new social model. Some say we should turn it over to the allegedly more capable.
“What more capable, Daddy?” “Us more capable!”

It’s like that song where the lady was driving on black ice, freaked out and hollered, “Jesus take the wheel!”

I notice the elect usually know less than the populace, so other solutions will probably be more rewarding.

A better solution is to construct models that let us better understand and work with our reality. The second half of the chessboard is new, but understandable, and has so far been very, very rewarding.

Take a wander through The 2nd Machine Age.

Or, consider The Molehill Business.

What is Trust?

Picture this: Lucy has convinced Charlie Brown to run up to kick the football while she is holding it. Charlie races toward the ball and just before he kicks it, Lucy pulls it away – again.

Of course, Charlie kicks nothing but air and winds up on his back with a thud; humiliated and disappointed – again.

Lucy has convinced Charlie yet again to trust her - that this time she will not pull the ball away and Charlie will not kick the air – but she really has a different agenda in mind. Charlie knows in his head that Lucy has pulled the ball away many times in the past, but wants to trust her, so he agrees. You know how it ends...thud.

Trust. Is it absolute or are there different levels? Can it fluctuate up or down the levels?

Consider trust in these circumstances:

• A baby trusting her parents,
• A person who is blind trusting their ‘seeing eye dog’,
• A military squad trusting each other with their lives,
• A group doing Outward Bound trusting other members to keep them safe during the trust fall,
• A business colleague sharing confidential information with you, trusting that you will not reveal what he has said,
• A sales person trying to close the sale asking you to trust him,
• A casual conversation with someone who prefaces a revelation with “trust me”.

These items are about one person ‘trusting’ another, however, going down the list the strength of that trust drops from absolute to nonexistent. The baby’s trust is unconditional and the blind person’s trust in the seeing eye dog is earned unconditional – while sales person's request is met with skepticism and the casual 'trust me' is merely rhetorical.

The Lucy and Charlie example shows the two aspects of trust - emotional and logical. Lucy has shown many times she has her own agenda and Charlie knows that from experience but really wants to trust her this time so he can accomplish his goal - logic and emotion.

In organizations, trust is reflected in its evolved culture – from accumulated experience.

Think about an organization:

• does management ‘trust’ the employees?
• do the employees ‘trust’ management?
• do either ‘trust’ the customers?
• does the customer ‘trust’ the organization and its people?

With this in mind, consider:

Ritz-Carlton hotel gives their employees the ability to commit several thousand dollars without prior approval to satisfy an unhappy guest’s problem; a similar policy of customer satisfaction is practiced at Neiman-Marcus. Or what about Zappo's full refund for a year from purchase, including cost of shipping.

How do their employees and customers regard these businesses?

Kmart (and other retailers) say they want complete customer satisfaction, but have a hardy (and inflexible) list of conditions on that complete satisfaction. How do their customers regard these stores and, as a result, how do the employees feel about the customers?

I have found that leaders influence trust – from doing what they say and saying what they will do - ‘walking the talk’ – to the way they choose to have the organization conduct business. Like smiling at a baby gets a smile in return, demonstrating trust in others elevates their trust in you and the organization. Keeping in mind trust has both an emotional and logical aspect – the effective leader must address how the customers and employees feel and react, as well as how each benefits.

Some additional thoughts about trust:

I believe fundamental honesty is the keystone of business. ~Harvey S. Firestone

The best way to find out if you can trust somebody is to trust them. ~Ernest Hemingway

Trust men and they will be true to you; treat them greatly and they will show themselves great. ~Ralph Waldo Emerson

Trust, but verify. ~Ronald Reagan (from an old Russian proverb)

As I see it, trust is in the framework of all successful organizations and it does not get there by happenstance. Successful leaders work hard to instill it in all aspects of the entity and in every individual, not as a tool or a technique, but as a fundamental belief.

How To’s in under a minute – Sales Lab Videos