Damn it, would you make a Decision!

Too many times, it takes too long to decide on major or even minor actions. Yes, decisions deserve careful study, gathering of the facts, assessing alternatives, but after all the analysis, the leader/manager who hesitates too long will be lost. Competition may overtake you and a late excellent decision may be no better than an early good decision.

In support of the World Series of baseball, let's use a baseball analogy.

Decision making is difficult, but can be very rewarding. The person who steps into the decision maker's batter's box confidently, challenges the pitcher, and takes the best swing is more likely to get the extra base hit than the person who is not confident, prone to be overpowered, and simply seeks to not look bad.

In the end, the ultimate test of an executive is their judgement and ability as indicated in the decisions they make, and how they make, implement, assess, and fine-tune or change them.

May all acquaintances never be forgot

I have been in London this past week and was able to connect with some long-time colleagues (some I have not seen in over three years). All are doing well and all are at new companies (one starting his own business). It is amazing that when you catch up with people, they have improved their situation (whether personally, financially, living where they want to live, doing something different that they always wanted to do, etc.) So there is hope for all of us, we just don't realize it.

It was interesting that most of the conversations were about the present and future. Little was discussed about the "good old days". Yes, there were questions around "hey how is so and so doing" or "remember that time when . . .".

The point of this post is that as a leader, I am proud how people continue to grow in business and their personal life. People that maybe I had a very small part in helping them along as a colleague/leader. I know, they no longer report to me but we had established a relationship that was more than a boss to subordinate but one is based upon mutual respect that continued over time. It seems when you work together accomplishing great things, you do create a bond that is difficult to be broken.

Yes, I have angered people in the past and might not have always made the right decisions, but it is nice to see that people respond to my email to have a drink and catch up after so many years. As a leader, I do my best to treat people with dignity and respect and it is a pleasure to catch up with old colleagues and hearing about their new adventures. Building a network is important and the best network is the one that is filled with people I have worked with. So, if you want to improve your network, reach out to an old colleague today (right now) and reconnect via email, text message, facebook, linkedIN, etc, you will be glad you did!

What have you done lately?

I periodically hear from people who talk about their past successful track record and accomplishments . . . constantly. (it is kind of like a high school star athlete who never quits talking about how great things use to be). Yes, that wonderful track record gave them credibility in getting the new position . . . and may have made a long-lasting contribution to the business (that's great). And others may sing their praises since they left because they were maybe more valuable than people realized at the time. In my view, they are entitled to the acclaim and reward that they received (hey, they earned the promotion, big bonus, etc.), but after a while, it is time to get over it. If you hear somebody mentioning all of their accomplishments on their former job, they are in trouble . . . especially if there is no mention on any accomplishments with the present job!

The old applause and accolades last only so long. You need to earn your applause in each job and each year. Again, "what have you done lately?". Hey, it is okay to talk about the old accomplishments, but just don't forget about making some new ones (plus it will give you more to talk about in the future).

The Silent Majority

How many meetings have you been to where there is one person who speaks louder than everyone else? Consequently, it is so loud that you feel that this is the majority opinion of all in the room.

As a leader, it is important to focus on more than the vocal few (whether clients, staff, other leaders, etc.). If you don't and remain based upon the few, you just might be making decisions based upon limited and sometimes wrong information. Get out there! Talk to people and ask questions, gather feedback and input from those that are not as vocal (or what I call the silent majority). If more people support the vocal few, you will be more confident in your strategic decisions. If they do not support the vocal few, learn what are the real issues and maybe you need to segment your clients or staff to address different issues.

Yes, it is hard work to gather feedback. It is easy to listen to just a few. Do your diligence and you will be more successful for it!

Not Feeling Productive?

I was talking to an old colleague last week. They felt a feeling of not being as productive as they could be. It was a feeling of not being sufficiently challenged, stimulated or excited by the job now and as you look down the road: a feeling that present and future problems and opportunities are not new or taxing or that they are actually downright boring. They had a belief that energy, creativity, talent and potential are not being tapped as fully and as frequently as possible. They look a year from now and do not see a lot of upside by doing what they are currently doing.

Does this sound familiar?

You can change this Manager's "malaise". Here are a few ways.

1. Change and vary the breadth, depth and type of assignment. Worse case, it is a new company, but before that try a new special project to mix things up from the past.

2. Gain new knowledge. Attend a conference, seminar, training. Do something that will advance your skill set.

3. Lead a task force on an important issue.

4. Gain an opportunity for a short-term or long-term travel assignment.

5. Exercise

6. Help set ambitious and tough objectives for you and your unit and strive to attain them. This will get you going (unless there are frustrating hurdles that will prevent the success as that could make the feeling worse)

7. Do a lunch that is not work-related.

There are many more but bottom line, you are in a funk and need to find a way out. Doing the exact same things will not produce new results, so you must change something about what you are currently doing.

Joke of the Weekend XXVII

Lots Of Overtime

BOSS: 'And how long did you work in your previous place of employment?'

JOB APPLICANT: 'Thirty years.'

BOSS: 'Hang on a minute! It says on your application form that you are thirty-two years old. How could you have worked there for thirty years?'

JOB APPLICANT: 'I did a lot of overtime.'

Curiosity

As you may know from previous postings, I have two sons (8 and 7 years of age) and two older daughters. All parents have wonderful children stories and I periodically share these on this blog and relate it some way to leadership. This is another one.

Earlier in the week, my 8 year old was taking a bath. I was out of town and my wife was "close by" in his room and decided as she was waiting for him to finish, she would polish her toes (red by the way). She accidentally left her nail polish on his desk in the room.

The next evening, he asked to take another bath (those with boys know how they hate to take a bath, so back to back bathings was a very strange occurence). She said "Sure". He then asked "Can I wear my water shoes in the tub?". SIDE NOTE: If you don't know what water shoes are, they are thin slip-ons that prevent slipping at a pool or helps walk on rocks at lakes/rivers/swimming holes (which Austin has many). She said "Sure", and did not ask why the bath nor why the water shoes, although he did wonder.

Here is what happened. After school, he found the nail polish on his desk that his mother had left and decided hey, I wonder what it is like to polish my toe nails, it looks kind of fun. After he did it, he was shocked to find out that it did not come off by rubbing it off. He tried to wash it off at the sink, again, with no luck. So, he thought if he took a bath and soaked, it would wash off (just like his paints he uses to paint pictures). He did not want anyone to see, so the reason about wearing water shoes.

Now, he would have never had said anything if it wasnt that his mother saw the nail polish and noticed the nail polish bottle and some red spots on his desk and went to the bath tub and asked if he had used the nail polish on something (thinking the worse, on walls, etc.). As my wife says, you would have thought a huge burden was lifted when he showed her his toes (my wife has a great way of remaining calm and not laughing, but if it was me, I would have been on the floor laughing (oh, OTFLOL). He explained what happened and he has been trying his hardest to get it off for the past hour but nothing is working. She explained about nail polish remover and they removed the nail polish together. He was extremely relieved. However, he did not want anyone to know, his brother, his dad, etc. Well, I needed a good laugh this week and my wife shared the story with me. My readers can keep a secret, right?

Okay, so why post this story? (1) luckily, he doesnt read the blog (not sure anyone actually does), (2) there are leadership lessons on several fronts, but one in particular. When you make a mistake, do not "hide" the issue if you cannot resolve the issue yourself. This is the worse possible thing that you can do. Yes, even if it is embarrassing, it is best to find someone that you can share with and resolve the issue. It will be a huge relief when you resolve the issue. Oh, and as a leader, follow my wife's example and not mine (as I would have been laughing, where my wife was a true leader by focusing on resolving the issue and not making fun of him).

Quality in Tough Times

As I have said, when times are tough, those organizations with solid foundation/relationships and quality products/services will weather the storm, i.e., a house made of brick versus hay. It is also a good time to focus on efficiency within your own organization, are there processes that can be put in place to make the operations more productive. Many times, we continue to operate as we do because we do not have time to step back and revisit how we do things. We are entering a time where we can do that and produce products faster and with higher quality.

And, if you are a small business, read this article.

The Crisis May Be a Boon for Some Small Businesses

From cheaper real estate to old-fashioned attention from banks, small businesses owners may see some good times ahead
By Gene Marks
Businessweek.com

http://www.businessweek.com/smallbiz/content/oct2008/sb20081020_489867.htm?campaign_id=rss_smlbz

Yes, it's definitely bad out there. And it will probably get worse. But most small business owners like me can also find some hopeful signs coming out of the financial nightmare gripping this country. I'm talking about people who have been running businesses for a while, who employ people, and have customers. Startups are a whole other thing (and good luck to them at the present!). It's those established business owners who will see some benefits of this mess in future months. Here are a few reasons why.

We're about to have a better relationship with our banker than we've ever had.

Know how over the past few years banks have been ignoring us, chasing the big money? Remember when we used to get tickets to the ball game or taken out for a round of golf? It's going to come back. Suddenly, those boring little local banks that lent money to small businesses with actual assets are looking pretty smart right now. Surviving institutions, their egos bruised and their credibility in ruins, are going to want to be just like them. Look for a change in the way the banking industry operates. A little more humble. A lot more relationship. They've taken their eye off the ball, chasing those subprime mortgage pots of gold for too long. Prepare for a resurgence of the old fashioned banker. Our businesses will be better off because of it.

We'll forget about stocks for a while.

In the good old days of the Dow 14,000, it looked as if the sky was the limit. Hey, why not take that extra cash and invest it on Wall Street? Who cares about that peeling paint and underpaid manager? We don't need those product enhancements or new machinery. There's money to be made with that guy from Merrill Lynch (MER)!

Well, we've all been burned a bit. And that guy from Merrill Lynch is serving me pepperoni slices at the local pizza shop. We've learned a lesson. Maybe investing our excess funds in better equipment or our people is a better long-term investment than that mutual fund holding securities in a company I've never heard of. Now that the stock market has lost its shine, business owners will start doing what we should have been doing all along. Reinvesting our money into our own companies is good for…us.

We'll rediscover our balance sheets.

Those bankers I mentioned before? Well, not only will they be paying more attention to us but they'll be paying even more attention to our financial statements. Those quarterly numbers and covenants from our loan agreements that they always seemed to overlook because they were too busy chasing those other big deals? They'll be looking at them now, trust me. Get ready to face some scrutiny. The last thing these bankers want is to get burned again.

But this is not a bad thing; it's a good thing. Quarterly financial statements and debt covenants are not a punishment. They're great metrics to help evaluate the profitability and value of a company. Shouldn't we have been paying close attention to all of this in the first place? It'll be more difficult to get credit for those companies that probably shouldn't be getting credit in the first place. There will be better financing opportunities for those companies that deserve it. It's time that we all get more disciplined. More prudent. More focused. Our bankers are now going to require this. And for good reason.

We're going to raise our prices.

Why? It won't be just to keep up with inflation (which is probably going to happen from all the money flooding the system by the Fed). It'll be because all of those idiot competitors of ours, without financing and facing a slow economy, are going to start choking on the fumes of their sputtering businesses. Suddenly, not showing up to jobs and doing shoddy work is going to mean something.

We knew they didn't know what they were doing. And now they're going to live down to their expectations. We've always known we do better work. And that our prices are worth it.

But how can we possibly prove it when some knucklehead with half the experience is also charging 20% less? Watch them fall. And watch our prices rise. Recessions and financial crises have a way of pruning the fat from the economy. The strong survive, and rise we shall.

We'll have a little more respect for regulation.

Small business owners, like myself, are loath to give the government credit for anything. We hate red tape and all the things that bureaucracy can to do to a capitalist society. We don't like big government spending or large tax increases. It's just part of our DNA.

But even this right-of-center writer has to have a little respect. It's not 1929 or 1907. There's the Fed and the Treasury and the Securities & Exchange Commission. No, they're not perfect. But they've kept the system going at a time when, historically, it would have imploded spectacularly.

They've so far coordinated pretty well with foreign central banks. Congress is raising the FDIC insurance coverage on our bank accounts. They're stepping in to do something to right all those bad loans. And they're making it easier for Warren Buffett to make even more money. I'm happy for Warren Buffett, too—he seems like a really nice guy. They have proven to me that there needs to be a role for regulation in a capitalist society.

We'll grab some space, too.

One day the newspapers are crying because real estate is so high no one can afford it. The next day they're crying because prices have dropped.

Well, we're not crying. The bursting real estate bubble means that we can finally, finally, finally buy that building or rent that space at a reasonable price. Not that overly inflated fairy tale of a price we were offered just a year ago. Now's the time to look for bargains. And the bankers will loan us the money…after they've protected us both by doing the appropriate amount of due diligence.

This year's going to be tough while the economy rights itself. But better days for small business owners are on the horizon. If we're lucky, we've got a few bucks in the bank and a few good employees still working hard for us. With that combination, smart business owners, and their newfound banking friends, will take advantage of this financial crisis and turn it into a long-term success.

Thrive in Tough Times

I could not have said this any better. This is a good post. We are and will face some tough times, thinking outside of the norm could provide you a competitive advantage. As I have said before, if you focus on providing solutions to client problems at a solid value to price ratio, you will be successful.

How Great Leaders Thrive in Tough Times
Posted by David Mammano

http://blog.inc.com/start-up/2008/10/how_great_leaders_thrive_in_to.html?partner=rss

Chester Arthur, who served as President of the United States from 1881 to 1885, will never be regarded as one our great leaders. In fact, many Americans would be hard pressed to identify him as one of our presidents.

Arthur, who served after President Garfield was assassinated, may well have possessed the basic qualities of a great leader. But the time of his presidency was fairly stable, so he was never called upon to step up.

Tough times, on the other hand, are when great leaders show their stuff. If you look at many of the famous leaders throughout history, you'll notice they became famous because they navigated through seemingly impossible times. They held the flashlight at the end of the tunnel.

Legendary leaders such as Abraham Lincoln, Susan B. Anthony, Franklin Delano Roosevelt and, more recently, Rudy Giuliani come to mind. All were faced with incredibly complex or catastrophic situations. Instead of cowering in indecision, they reacted boldly and aggressively. They threw conventional wisdom out the window and developed their own playbooks on the spot.

So what does this have to do with entrepreneurs? In short, it's time to step up as leaders of your enterprises. Extremely difficult economic times are here and may be here to stay. You're time to shine is here.

So what is a business leader to do? The reflexive action is to take a hatchet to the budget, impose layoffs and halt all plans for growth. These steps are relatively easy to take, so leadership skills rarely come into play. And often, they are exactly the wrong things to do.

But great leaders know that only dead fish swim with the current. So they work harder to get through trying times, searching for more creative solutions and inspiring their coworkers to stay engaged. They also take some time to pause and think because they know they shouldn't react impusively. Only then do they act.
So how am I trying to live up to this leadership ideal? After pausing to think, I'm taking the following steps:

1) I asked my coworkers to help me look at our expenses and figure out where we can cut. Engaging the staff in this process is crucial. They need to understand that it's a time for sacrifice, and they'll be happy to be part of the process if you let them.

2) I'm looking for new opportunities that arise from the economic problems we're facing—new trends or market needs that will rise up because of the hard times.

3) I'm enhancing customer service to make sure the people who already love what we do don't slip away. It might be hard to find a lot of new business during a recession, so we need to work even harder to convince our current customers to sit tight?

4) I'm doing more marketing, not less. Many companies reflexively shut off their advertising efforts during tough times. I'd rather shut off the water supply than my marketing. With fewer customers in the market, we need to fight even harder for those that remain! Plus, if my competitors stop advertising, I'll get more bang for my buck in the ad market. And if the market is less cluttered, our marketing efforts stand a better chance of getting noticed.
Bottom line: Don't be depressed about the tough times ahead. Get excited and view it as an opportunity to test your skills as a great leader! Chester Arthur would have relished the opportunity.

ROE: Return on Enjoyment

When are you the happiest at work? Is it the end of the day and you are ready to go home? (not good BTW).

When I step back and examine the most enjoyment I have/had at work, I categorized work/project into three sections: Planning, Building, Finishing. Yes, this is simplistic.

With Planning, this is the idea phase, e.g., brainstorming for a solution, where you are working to solve a new problem or creating a new market. This phase has enjoyment, able to think anew and don't have the added pressure to actually build it.

With Finishing, this is the closing phase. This might be finding out that you won an account or that the product is created and now its time to roll it out. This phase has a sign of accomplishment as you are delivering the product/services.

With Building, this is the creation phase. The Idea becomes reality. As you implement/build, you run into challenges that must be addressed. The enjoyment for this phase is the creation of value.

When I review these three, the last one has the highest return on enjoyment for me. It might just be the most difficult phase but this is where teams come together to build value. When I look back on my leadership roles, the times we implemented the vision/goal was most enjoyment. Each time, the results might not have been the best, there were many doubters, but there were a few people who believed and came together to create a foundation of future success. At the time, it might not have seen the happiest, but in hindsight it did have a high sense of enjoyment and accomplishment.

Bob the Builder really rocks!

Start a Company in Recession

What is your dream? Do you have an idea that you think would be successful if . . . only . . . you took the risk? This article below discusses that the best time to start a company might be during a recession.


Starting Up in a Down Economy

Nobody loves a recession*. But many successful entrepreneurs say that, in retrospect, they were lucky to have launched their businesses in tough times.

By: Ryan McCarthy, Nadine Heintz, Bo Burlingham
Inc.com

http://www.inc.com/magazine/20080501/starting-up-in-a-down-economy.html

Case Study No. 1: How Method Weathered the Dot-com Bust
* A recession is commonly defined as two consecutive quarters during which the country's gross domestic product shrinks. It is too soon to say whether the economy is in a recession now.

When they look back on the early days of their start-up, Adam Lowry and Eric Ryan remember that a lot of potential investors laughed at them. The Bay Area, where they were living, was awash in Internet start-ups. Each week in 2000 brought another glitzy launch party or news that the scantest of business plans had attracted venture capital. Even office landlords were demanding equity from their dot-com tenants. Lowry and Ryan, who wanted to start a company to make -- of all things -- humdrum household products, were decidedly out of step with the times. "You had the sense that there was this real historical thing going on in the region, even if it was not going to end well," says Ryan.

Still, Ryan and Lowry felt they had a good idea. Method, their start-up, wouldn't sell just any household products. Its soap and cleaning supplies would be made from environmentally friendly ingredients and would come in chic packaging. Compared with the products of giants like Procter & Gamble (NYSE:PG) and Clorox (NYSE:CLX), Method's merchandise would be hip. So the partners passed on interesting and potentially lucrative job offers and pooled $100,000 in personal savings to get started.

You know what happened next: The go-go New Economy abruptly ran out of steam. Dot-coms ran out of money, layoffs were rampant, and the entire city of San Francisco seemed to suffer from an economic hangover. People started to worry openly about a recession.

Like most business owners facing hard times, Lowry and Ryan focused on their costs. They were expert bootstrappers, mixing cleaning solution in a bathtub, bottling it themselves, and driving around town to restock shelves. They would accost any store manager who would listen to their spiel. They returned to some stores three and four times before they got an order, and little by little their sales pitch improved. And the partners noticed something else: Compared with the situation a year before, when there seemed to be five start-ups for every idea for a business, the competition was relatively muted. "Starting a business in a recession is like vacationing in the off-season," says Ryan. "It's a little less crowded, and everything starts going on sale."

By spring of 2001, Lowry and Ryan had gotten small-batch production on track and had hired a CEO named Alastair Dorward. But Method's debt stood at $300,000, split among the three men's personal credit cards. Payments to their vendors were three or four months past due, and at one point Lowry and Ryan had just $16 left in the bank. "We had to appeal to the inner entrepreneur of each of our vendors," says Lowry. "We had to sell them on the fact that Eric and I could do something that had never been done before."

Lowry and Ryan also tried again to raise money, and with VCs falling out of love with dot-coms, they found that there was more interest in their idea. In early September 2001, the partners received a term sheet for $1 million -- a sum that would allow Method to get current on its bills and then begin to expand. They were set to close the round on September 11. Needless to say, the deal didn't go through right away; the partners finally closed in November. And there were some serious strings attached. Lowry and Ryan would receive $550,000 up front. Of that money, the legal fees associated with the transaction would eat up $110,000, and $300,000 would go to pay outstanding vendors' bills. That left Method with $140,000 in capital. To get their hands on the remaining $450,000, Lowry and Ryan were obliged to meet a key milestone: They would have to add distribution to 800 stores by March, which was just five months away.

The tenuous nature of Method's financial situation was underscored at the dinner Lowry, Ryan, and Dorward hosted to celebrate the deal. The partners gathered their investors plus their lawyers and accountants at an expensive restaurant in San Francisco. When the bill came, Lowry's credit card was declined. Then Ryan's card was declined. And Dorward's. Their backup cards were declined, too. "It's a good thing Eric knew the owner of the restaurant," says Lowry. "We convinced him we were good for it -- that that guy over there was about to give us a million bucks."

Method did make it into 800 stores by March -- though just barely. When Lowry and Ryan got the remainder of their Series A funding, they paid off old accounts and then jumped right back into fundraising mode. With the recession in full swing, venture capitalists were being very picky when it came to making new investments. But Method, which had been ignored barely 18 months earlier, was suddenly a Bay Area darling. "It was really interesting," says Lowry. "We used to be completely off investors' radar screen, but when the bubble burst, people were clamoring for us. Our business plan wasn't some sort of ad-based or online thing that was hard to understand. Our model was, 'Hey, we're going to make this cool product, and if you think we can sell a lot of it, then it's a good investment.'"

Being able to raise money in 2001 undoubtedly put Method on the growth path. By 2006, the company had $71 million in sales, and today the founders are pushing to reach $100 million. But Lowry and Ryan look at the period before they raised money, when they struggled and nearly drowned, as pivotal. In retrospect, the fact that they had to hone their pitch in countless meetings with store managers and vendors was fortuitous. They were practiced enough that by the time their big break came -- pitching Target for national distribution -- they didn't blow it. Which raises the question: Did the recession actually make Method better? The founders think so. As Ryan puts it, "The hungriest wolves hunt best."


. . .

Case Study No. 3: Hard Lessons Learned From Clif Bar's Fast Start
Gary Erickson couldn't have cared less about the state of the economy as he drove across the Bay Bridge in September 1991. What he needed was a name for his new energy bar. The next day, he was going to a cycling industry trade show. Bike shops figured to be his main retail outlets, so this was a chance to get buzz. Without a name, he might as well stay home.

Then, as he made his way to the office of his package designer, it came to him: Clif. It was his father, Clif, who had instilled in him the love of the mountains, who started him skiing at the age of 4, who was responsible for all of his outdoor passions, from rock climbing to bike racing. It was perfect. And so Clif Bar was born.

Although he didn't know it at the time, Erickson started his business in the middle of a recession. The downturn began in July 1990, four months before it dawned on Erickson that he could make a better-tasting energy bar than PowerBar, which had the market to itself back then. By the time he shipped the first Clif Bars, in February 1992, the recession was officially over, although the hard-times mentality lingered long enough to ensure Bill Clinton's election that fall.

"The economy, stupid" may have been as much of a boon for Erickson's start-up as it was for the Clinton campaign. Erickson found, for example, that contract manufacturers were delighted to do business with him. Would that have happened if they hadn't been worried about their own sales at the time? Perhaps. It would certainly have been more difficult for him to have signed them up if the economy had been booming and they had had all the work they could handle. He could have found himself pleading with vendors to take on a start-up that might not have survived long enough to pay its bills.

And unlike the owner of an established business, who faces a number of distractions in a recession, Erickson was free to focus on developing the bar, marketing, finding distributors, and so on. When you're starting out, you naturally worry most about the possibility of failure, and so you devote your energy to avoiding it, which means making sales and generating cash.

What people seldom prepare for is the possibility of success, especially when times are tough. (Boom times are different. In the late 1990s, it often seemed that most entrepreneurs were already figuring out how to spend the money from their future IPOs.) And yet success brings with it dangers of its own, as Erickson soon discovered.

Today, Erickson says a "cocktail" of factors made it possible for him to start Clif Bar back in 1991. Without any one of them, he probably would not have launched the business. To begin with, there was the wholesale bakery he had founded in 1986, at the age of 29. He named it Kali's Sweets & Savories, after his grandmother, Kalliope. It made Greek calzones and cookies, all from his mother's recipes. He sold them to specialty food retailers in the Bay Area, such as Peet's Coffee. By 1991, the bakery employed 10 people and was doing close to $300,000 a year in sales but had yet to break even. Erickson estimates that it was losing from $10,000 to $20,000 per year -- a situation that was no doubt aggravated by the recession. He worked nights and drove the delivery truck on Tuesdays and Fridays. By day, he continued to work full time at a bicycle company. To help manage the business, he brought in Lisa Thomas, a bookkeeper for his brother's foundry. Grateful for her involvement, he made her a co-owner of Kali's, with 50 percent of the stock.

Erickson doubts he would have been successful with Clif Bar without the education he received at Kali's. "Your entrepreneurial M.B.A. begins when you start your own business and sign a check, hoping it doesn't bounce," he says. "If Kali's had never happened, I'd probably still be working for a bicycle company."

Of course, that job in the bike industry was another ingredient of the Clif Bar cocktail. "I was involved in industrial design and manufacturing there," he says. "I ran a facility with 40 people. I knew how to manage a P&L. So none of that scared me. And I understood the market that PowerBar had developed, so it wasn't hard to visualize that I could draft off their wheel, as we say in bike racing."

Bike racing was the last part of the cocktail. One weekend in November 1990, a friend invited Erickson on a 125-mile ride that turned out to be 175 miles. He had brought six PowerBars with him. After he ate the fifth one, Erickson found a 7-Eleven, where he devoured half a dozen powdered doughnuts. Right then, he had an epiphany: He knew he could make a better-tasting product.

Erickson spent the next 15 months developing his energy bar while Thomas looked after Kali's. Working with his mother in her kitchen in Oakland, he tried various flavors and used his bike-riding buddies as taste-testers. Meanwhile, he found a bakery that had the necessary equipment to make the bar and was eager for the business. Once he had figured out the bar's size and shape, he went to work on the packaging and kept at it right through the trade show in September 1991, which was a big success. More than a thousand bike shops expressed an interest in carrying Clif Bar.

It took another five months to launch. By then, Erickson had two distribution agreements in place, but his expectations were modest. "PowerBar was doing probably $6 million or $7 million a year at the time," he says. "I'm thinking, Gosh, if we could grab 20 percent of their market share, we could get to $1 million, maybe even $2 million, and laugh all the way to the bank."

In February 1992, Erickson shipped the first 30,000 Clif Bars to his distributors -- and the product took off. Sales totaled $700,000 in the first year and $1.2 million in the second. In 1994, he blew past his initial goal of $2 million in sales. And around that time, he discovered his first costly mistake. It involved his two distributors. Erickson felt their performance was faltering, and he wanted to bring distribution in-house. The problem was, he didn't have a contract with either company. Out of naiveté, haste, or reluctance to spend money on a lawyer, he had done both deals on a handshake, and the distributors' understanding of what they had agreed to was different from his. He wound up settling with both of them at a total cost of $2 million.

The second mistake took a longer time to reveal itself and was much more serious. In launching Clif Bar, Erickson had neglected to set it up as an entity separate from Kali's. As a result, he and Thomas each owned 50 percent of the stock. The full consequences of that decision -- or nondecision -- became apparent in 2000, when Erickson turned down an offer of $120 million for Clif Bar.

Thomas wanted to accept it, and as an equal partner, she could have brought down the company if Erickson didn't accede to her wishes. In the end, parting ways with Thomas cost him more than $80 million, including interest, legal costs, and noncompete fees -- all for a mistake that could have been easily avoided in 1991.

"I could have left her as 50 percent owner of Kali's and told her this was a new business, which it was," Erickson says. "Instead, I just rolled Kali's into Clif Bar."

Lessons in entrepreneurship don't get much more expensive than Gary Erickson's -- at least not for people whose companies survive. Despite the burden of the buyout, Clif Bar managed not only to survive but to prosper. This year, Erickson expects sales to top $200 million. Succession is the big question on his mind these days, although he does wonder about the possible impact of a third recession in 18 years. Somewhere, after all, another start-up could be taking aim at Clif Bar, and a recession might be just what it needs.

Joke of the Weekend XXVI

Happy to provide from a friend from downunder . . .

YOUR YEARLY DEMENTIA TEST

It's that time of year again, time to take the annual senior
citizen test.


Exercise of the brain is as important as exercise of the muscles.
As we grow older, it's important to keep mentally alert. If you don't
use it, you lose it!

Below is a very private way to gauge your loss or non-loss of
intelligence


Take the test presented here to determine if you're losing it or
not. The spaces below are so you don't see the answers until you've
made your answer.
OK, relax, clear your mind and begin.


1. What do you put in a toaster?



Answer: 'bread.' If you said 'toast,' give up now and do
something
else. Try not to hurt yourself.
If you said, bread, go to Question 2.


2. Say 'silk' five times. Now spell 'silk.' What do cows drink?







Answer: Cows drink water. If you said 'milk,' don't attempt the
next question. Your brain is over-stressed and may even overheat.
Content yourself with reading a more appropriate literature such as
Auto World. However, if you said 'water', proceed to question 3.


3. If a red house is made from red bricks and a blue house is
made from blue bricks and a pink house is made from pink bricks and a black
house is made from black bricks, what is a green house made from?



Answer: Greenhouses are made from glass. If you said 'green
bricks,' why the hell are you still reading these??? If you said
'glass,' go on to Question 4.



4. It's twenty years ago, and a jet plane is flying at 20,000 feet
over Germany (if you will recall, Germany at the time was politically
divided into West Germany and East Germany ). Anyway during the flight,

TWO engines fail. The pilot, realizing that the last remaining engines

are also failing decides on a crash landing procedure.
Unfortunately, the engines fail before he can do so and the plane
fatally crashes smack in the middle of 'no man's land' between East and West Germany .

Where would you bury the survivors? East Germany , West Germany or 'no
man's land'?




Answer: You don't bury survivors. If you said ANYTHING else,
you're a dunce and you must stop. If you said, 'You don't bury
survivors', proceed to the next question.




5. Without using a calculator - You are driving a bus from London
to Milford Haven in Wales . In London , 17 people get on the bus; in
Reading, six people get off the bus and nine people get on. In Swindon , two people get off and four get on. In Cardiff , 11 people get off and 16 people get on. In Swansea , three people get off and five people get
on in Carmathen, six people get off and three get on. You then arrive
at Milford Haven. What was the name of the bus driver?





Answer: Oh, for crying out loud! Don't you remember your own
name?
It was YOU!!





Now pass this along to all your friends and pray they do better
than you.

PS: 95% of people fail most of the questions.

Involve Others

I really like the following post. When the chips are down, dont try to "go alone". Involve the staff, they have some good ideas! Many times, leaders think they have to make the decisions "top down", but the people on the front line might have more clarity to how an issue can be addressed.


How to Cut Budgets Without Destroying Morale
Posted by David Mammano

http://blog.inc.com/start-up/2008/10/how_to_cut_budgets_without_des.html?partner=rss

I am not sure if you noticed but budgets are being cut. My company, Next Step Magazine, gets most of its revenue from colleges, student loan companies and the military advertising. We've already seen the student loan companies disappear due to the liquidity crisis. As the recession deepens, we need to be prepared to feel the pain from other advertiser cuts as well.
So far, we're hanging in quite well. But just a few bad few months can reverse a small business's success. So what is a maverick small business guy to do? (Sorry, just wanted to say "maverick.") Cut the budget, of course. The last thing you want to do, however, is cut payroll and thereby derail the morale of your coworkers. The first thing to do? Engage everyone in the process.
That's what I did yesterday. We held a non-mandatory budget cut meeting. Since Next Step has an open book management philosophy, everyone knows every line item in the budget anyway. So about half the staff showed up to offer their thoughts on what we can cut.
They shared some great ideas and seemed to feel excited to be part of the process. They thought of things that I hadn't. Their ideas ranged from postponing new computer purchases to having the staff volunteer to bake birthday cakes instead of the company buying them.
My role was to shut up and listen. Of course, that was not entirely possible, but I think I did quite well!
Bottom line, I expect their suggestions to save us around $50,000 a year, which will be a real help. And it also helped that the staff was involved. Nobody likes heavy-handed, top-down decisions that don't allow for any feedback. Granted, you won't be able to implement every suggestion you get from your staff. But the environment you'll create by sincerely listening can make the hard times ahead feel that much less painful.

CEOs on the Global Economy

How bad is this economy going to get? Well, this Fortune article below, does not have a positive outlook. Cash is king now. We will get through this, i.e., weather this storm, but you need to make sure you have the staying power and focus on adding value for the price of your products.

Global CEOs brace for the worst
At a Fortune conference in London, top brass see a downturn that could last for years.
By Stephanie Mehta
www.fortune.com

http://money.cnn.com/2008/10/08/news/economy/globalbummer_mehta.fortune/index.htm?postversion=2008100916

LONDON (Fortune) -- Forget bolstering consumer and investor confidence. Governments and central banks may need to figure out a way to boost CEO confidence, too.

At a Fortune gathering here this week, chief executive officers of large global companies and some of their top advisers expressed grave concerns about the state of the world economy, and are preparing for at least a couple hard years ahead.

"For the last 3 ½ to 4 months I've been asking people to operate as if we were going into a recession," said Ian Livingston, CEO of BT (BT), the telecom company that ranks 116 on the Fortune Global 500 listing of the world's largest corporations. "I wasn't anticipating things would be as bad as they are."

Livingston, whose company provides phone, video and broadband services, says the company certainly will feel an impact from a sustained economic downturn: If people don't have jobs, they will spend less on communications services.

Same with smaller companies: no credit means businesses don't expand, which translates into fewer data and phone services for BT to sell. Livingston is even guarded when he talks about BT's bright spot, sales to corporate customers.

Though BT last quarter said orders from big customers remain strong, "if big companies get hit hard they will pull back," he acknowledged.

Sector by sector tsunami
Livingston's cautious view is echoed by dozens of CEOs interviewed by Steve Tappin, a managing partner in executive search firm Heidrick & Struggles' global CEO practice and author of The Secrets of CEOs.

Tappin says the chief executives he spoke with after the credit crisis materialized (but before the banking system really started to break down) were preparing for battle.

"There's a tsunami that's gone through sector by sector," Tappin said. "Many CEOs think this is going to be a multiyear downturn."

Some are expecting two to three years of hard times while others tell him "this is something we're not going to see again in our careers."

Even executives from still-growing emerging markets are uncharacteristically muted in their remarks on the global scene.

Girish Paranjpe, co-CEO of outsourcing giant Wipro (WIT), says growth in countries like India, China and Brazil can't for slowdowns in mature markets.

The emerging economies "will mitigate" the pain, he said. "I don't think they will offset it." For Paranjpe, who used to run the Wipro division that serves financial-services customers, the breakdown of the banking sector has hit particularly close to home. "I know many of the executives personally," he said, "and some of them are now unemployed."

Dream

If you have a dream or something that you always thought about doing, the best time to begin the journey is today . . . not tomorrow, or next week or next month or next year. Today is the first day of the rest of your life. So, what are you waiting for?

Sometimes as leaders, you make a decision based upon limited information that sets a path forward. However, the path is not the right one as more information is gathered. You can continue to take the path (make the best of it) or make a decision to reverse your decision, backup and do over. Yes, it might not be pleasant, but it might be the best path to move forward. I would caution that you don't have too many chances for do over's.

Fortune Cookie

I had a nice chinese dinner with my daughter when I was in Boston last week. At the end of dinner, as is tradition, we both received a fortune cookie. Now, they are usually silly and fun. They ususally provide a good laugh. My "fortune" was "Look forward to great fortune and a new lease on life!". Hey, that was a good one. Right, like this is really going to happen (plus, one new lease on life in a year is enough). Anyway, I have a great fortune as it is, healthy family, good friends, etc.

While this was silly, I have to admit . . . it made me feel pretty good. I know that this is not a "true" fortune, but it provided an uplift (okay, you can call me silly as well).

As I walked back to hotel, I contemplated why something so silly gave me positive energy. Was it that I was troubled and somehow this provided a diversion? Well, I thought it was simple (and for which leaders need to provide all the time), a vision of the future possibilities is uplifting . . . we often get so stuck in the weeds and troubles of today that we (or maybe it is just me) don't lift our heads up to see why are we doing what we are doing and what is ahead of us. Leaders, do not forget to provide that vision of the future (i.e., the Fortune Cookie for your unit) for each individual and the unit as a whole! It will be a rallying call (and positive energy) for the unit and staff who are working hard each and every day.

To Give, Is to Receive

I had an interesting experience this past weekend. No, it was not the #5 University of Texas Longhorns versus the #1 Oklahoma University Sooners football game in Dallas, Texas. Yes, we attended the game. Yes, Texas won 45 to 35. Yes, it was a great game with Texas now being rated #1 in the country (not sure for how long). No, it was the next day.

We decided to go to Six Flags over Texas, this is an amusement park, with lots of rids and roller coasters. As we were buying tickets, we had lots of options to optimize the cost with the number of people and since it is towards the end of the season, there were some additional options. Anyway, we figured out (through solid mathematical assessment routines) that if we bought three late year season passes, that we would get a free additional day pass for each season pass. We had a total of five people in our party. If you do the math, we had a free day pass that would not go used. So, what would you do? Save for another day, just keep it, give it away . . .

I decided to give it to the family behind us in line. You would have thought they won the lottery, they were so thankful. I try to explain to them that we got that one pass . . . free and it was no big deal. However, the mother of the family was just so thankful (I think we may be part of their extended family now).

It just shows you that what you may feel is of no value (or free) could be of substantial value to someone else. As this relates to this blog, there are little things that leaders can do (that might be "cheap" or "free", like a compliment when someone does a good job) but is seen as a tremendous value to a staff member. I am not saying that I am a super charitable person as I probably don't give enough as I should, but the feeling I got after we went on our way in the amusement part was a super feeling (and made my day). So, I got more, then I actually gave, which I think is a good thing and reminded me that to give, is to receive!

Joke of the Weekend XXV

Smith goes to see his supervisor in the front office.

"Boss," he says, "we're doing some heavy house-cleaning at home tomorrow, and my wife needs me to help with the attic and the garage, moving and hauling stuff."

"We're short-handed, Smith," the boss replies. "I can't give you the day off."

"Thanks, boss," says Smith, "I knew I could count on you.

Making Tough Decisions

All of us are faced with tough decision periodically. Well, I am faced with you (although this is actually easier because either decision that I make, will be a good decision, how often is that the case).

I found this article, which is a simple way to make decisions. It hit home to me, because many decisions are about you.


How to Make Smart Decisions in Less Than 60 Seconds
by Steve Pavlina
www.stevepavlina.com


http://www.stevepavlina.com/blog/2007/07/how-to-make-smart-decisions-in-less-than-60-seconds/

Sometimes we face tough decisions that involve one or more unknowns. We can’t know in advance what the consequences of each alternative will be. This is especially true of big decisions like quitting a job, entering or exiting a relationship, or moving to a new city.

When faced with such a decision, what do you do? If you can’t figure out the consequences, can you do any better than guessing?

Usually what people do in such situations is freeze. Even when you don’t like what you have, you may worry that the alternatives are worse. In a way every decision involves a choice between maintaining the status quo vs. making a change. When we can’t be certain a change will work out for the better, by default we stay put.

Let me give you a very simple method of making these kinds of decisions. In most cases it takes no more than 60 seconds to evaluate any particular path.

For each alternative you’re considering, ask yourself, “Is this really me?”

What you’re asking is whether each path is a fair expression of who you truly are. To what degree does each option reflect the real you?

Decisions are acts of self-expression

When we look at choices as being more than just paths — as being creative statements of self-expression — certain decisions become much easier to make. You may say to yourself, “This path isn’t going to be easy, but I know this is the right way to go because it’s who I am.” Or you may conclude, “No matter how I try to represent this to myself, I know that deep down this isn’t who I am. This just isn’t me.”

It’s very important to separate this evaluation step from the act of summoning the courage to act on this knowledge. It’s OK to acknowledge you’re in a place you don’t want to be, even when you lack the ability to do anything about it right now. The courage to act comes later.

Here are some ways you can apply this method:

Is this job really me?
Is this company really me?
Is being an employee (or enterpreneur or investor or business owner) really me?
Is this relationship really me?
Is this city really me?
Is this house really me?
Is this book I’m reading really me?
Is this shirt/dress/tie really me?
Is this friend really me?
Is this hobby really me?
Is this car really me?
Is this food really me?
Is this habit really me?
Is this spiritual or religious belief really me?
Is this level of fitness really me?
Notice that you can apply “Is this really me?” to decisions both big and small. This is something you can use every day, even when you’re just deciding what groceries to buy.

Say a few syllables

If you have trouble deciding if a decision is really you, just describe its attributes out loud. In the words of the Three Stooges, “Say a few syllables.”

For example, when you’re thinking about changing careers, describe the new career you’re considering. Is it safe or risky? Bland or exciting? Social or solitary?

Now consider whether those same adjectives could describe you as a person? Are you safe or risky? Bland or exciting? Social or solitary? Is this career really you?

Sometimes this can get a bit silly, but I’m certain you’ll gain some interesting insights if you just humor me and do it.

If you’re feeling bold, do the same for your your closest relationships. It will teach you a great deal about which people are the best fits for you. If your current relationship feels a bit off, this process will show you why. You’ll be able to see where your true self and your current reality are misaligned.

A personal example - shopping for a desk

Three weeks ago Erin and I moved to a new house, and I wanted to get a new desk for my office. (My old desk was 14 years old and so worn down that charities didn’t even want it. I opted to use it for martial arts practice until it was a pile of sawdust.) This time I wanted a high-quality desk that would last me a long time instead of the particle board special I bought for $99 after college.

I made a detailed list of criteria for what I wanted, took measurements of the available space, and gave myself an unlimited budget. I browsed through many local furniture stores and searched through office furniture web sites, but nothing really grabbed me. I started thinking maybe I should have a custom desk built, but that seemed like overkill. I started to get a bit frustrated, and my new home office remained deskless for several days. I thought to myself, “This should be an easy problem to solve, especially with no fixed budget. I must be making this harder than necessary somehow.”

Eventually I stepped back and asked myself if there was a better way to find the right desk. I didn’t want to settle for something I didn’t like, but I realized that instead of trying to find something that met my far-too-anal list of criteria, what I really wanted was a desk that would suit me, something that would reflect the kind of person I am.

So I decided to make the decision by looking at each candidate desk and asking myself, ”Is this really me?” I went back to the same local stores, and it was an amazingly different experience. Instead of looking for what I wanted, I looked for who I was. I looked around for something that was me in the form of a desk.

Yeah, I know that sounds weird. In fact, I actually wanted to find a desk that was a bit weird. If it wasn’t a little weird, it wouldn’t be me. When I saw a desk that I thought anyone would appreciate, I knew it wasn’t for me.

Normally I hate shopping, but I actually enjoyed the experience this time. I’d probably enjoy shopping a lot more if I always did it this way. I’d look at a very ornate and classy desk, and I’d say, ”That’s not it. I’m not an ornate and frilly person.” I’d see a heavy, solid desk that only Superman could lift and say, “That one is too heavy. I’m lighter than that.” I’d see the cheap particle board furniture and think, “Nope. I’m more durable and tougher than that.”

That sounds a little like the story of Goldilocks and the Three Bears, doesn’t it?

Eventually I sat down at an unusual desk that caught my eye. It was an elegant mix of glass, metal, and wood. It felt almost familiar when I sat down, but in an alien sort of way. I wasn’t quite sure what to make of it. It definitely wasn’t love at first sight, but there was a compelling infatuation. I became very curious about it.

This was a desk I’d previously bypassed because at a glance I could tell it didn’t fit my initial criteria. This time when I asked, “Is this me?” the answer didn’t come back as an immediate yes. I had to think about it. I described the desk to myself. I said, “This desk is clean, efficient, organized, transparent, flowing, intelligent, creative, and well-constructed. Some people would love this desk, but others would find it rubs them the wrong way. I’m not sure if I like it, but it certainly grabs my attention. I could never be bored in a room with this thing.”

I soon realized this was the right desk for me because I was describing myself. Having used it for a couple weeks now, I’ve grown to really love it. It’s just so me.

So here was a decision that was important to me – I’ll use my desk a lot, so it’s worthwhile to get a good one — but I was making the decision way too complicated. Asking, “Is this me?” cut through the complexity and allowed me to figure out my true criteria. Every desk I considered helped me converge on the final solution.

Again, I fully realize this must sound plenty weird to someone who’s never tried it. So don’t be someone who’s never tried it.

Positive reinforcement

When making decisions via the “Is this me?” method, you’re using an idealized version of yourself for the comparison. This is your best self. It’s who you are in your dreams and goals, who you want to be.

What happens when you begin to fill your life with people, places, and objects that reasonably reflect your true self? By osmosis you’ll begin to take on more of those qualities yourself. Just sitting behind my new desk makes me feel more organized, efficient, and creative. It’s a constant reminder of the kind of person I strive to be. Even when reality falls a bit short, I keep coming back to this daily positive reinforcement. I don’t even have to think about it. For further thoughts on this line of thinking, see the article Environmental Reinforcement of Your Goals.

I’ve been using this “Is this me?” method a lot lately. I recently taught it to Erin, and she’s been telling me how much she likes it too. When we go furniture shopping, we’ll look at a piece and say, “Is this really us?” So far we always seem to be in agreement. It’s a great way to make sure we’re on the same page.

Look around you. What can you say is really you? What isn’t? What can you do about it?

10,000

The blog reached 10,000 views yesterday (while the Dow stands below 10,000). I want to thank you, the readers. While many topics are not great or creative, I do hope that you take something away from the postings or you think about something slightly different than you have in the past. I have found writing this blog is cathartic. I try to share ideas, past and current experiences, and thoughts on what I think a leader should be (and yes, something I would like to continue to strive to be as I am not perfect).

Lots still going on in my business life. I am surprised that I have posted every week day (and weekend) since first of April. Again, thanks for reading.

Start a new business Now in this environment?

I have said this several times. There will be ups and downs in the economy, that is capitalism, ensuring that resources are being used in the most effective and efficient way. You do not need to be a Rocket Scientist (or Economist) to know that the global economy is struggling and there are issues that need to be addressed.

With any change, there is opportunity. Companies have problems that need solutions, granted, they are different problems (and solutions) when the economy is struggling versus when it is growing rapidly. All companies are problem solvers, there is a problem/issue in the marketplace(i.e, demand), and companies provide the solutions (whether its how do you get from Boston to New York, i.e., multiple solutions, drive a car, fly, take a train, etc.).

In this environment, look for the new problems to be solved, not what you have to sell (demand driven versus supply driven). When I saw this article below, it made sense. If you have a unique solution to a current problem, wouldn't it be a good time to start a business? Yes, it is a simple article but I think you get the point. (oh, I have known many people all over the world who are entrepreneurs and that is just not an American thing.)

Starting a Business in a Downturn
It might go against your instincts, but starting a business in a soft economy has advantages.
by Karen E. Klein
Business Week.com

http://www.businessweek.com/smallbiz/content/oct2008/sb2008106_319606.htm?campaign_id=rss_smlbz

To many people, the idea of starting a new business right now sounds about as attractive as going all in on the stock market. But Peter Justen, a serial entrepreneur and founder of MyBizHomepage, which provides online financial tools to small companies, says it just might make sense. He spoke recently to Smart Answers columnist Karen E. Klein about the advantages of lessened competition, great deals on real estate (BusinessWeek.com, 8/22/08) and office furniture, and a ready labor supply. Edited excerpts of their conversation follow.

Conventional wisdom these days advises entrepreneurs—all of us, really—to hunker down and wait out the financial storm. Why isn't that good advice?

It's always a matter of perspective, and there's always a way to prosper during a downturn. Years ago, I went to my first boss and complained that the market was bad and I couldn't sell anything. He told me: "Successful people joke and laugh it off, and unsuccessful people complain about how bad the market is." I've never forgotten that.

Isn't this a terrible time to try to get funding for a startup?

Risky startups have never gotten funding, so what's changed? There are 27 million businesses in the U.S. and the vast majority of them are not credit dependent. Their credit line is a Visa card, savings, and friends and family. Good credit will get good loans and that's how it should be. Those who don't have good credit need to be more creative.

What are some of advantages of starting up in a downturn?

The real estate market is slowing in most regions of the country, which allows for small businesses to get retail, office, and warehouse space at reduced costs. It's also easier to negotiate for landlord build-outs, signage, and parking.

When it comes to setting up a business, you can find great deals on nearly new furniture, copiers, fax machines, computers, and office fixtures at auctions where companies who ramped up too fast are selling for a fraction of what they paid. We're growing and we just got new office space. We bought furniture at auction for about 10¢ on the dollar.

Unemployment rates continue to rise. Is this a good time to attract employees?

I think there's a flight to safety, and there's a certain comfort level with small companies. There isn't the job security in the big companies that there once was. In tough times, businesses lay off good employees who are willing to accept pay cuts for employment with a company that offers other benefits, like a shorter commute, an improved lifestyle, or more interesting work. There used to be a stigma about going to a small company, then it [had] cachet during the technology boom, and then it became a stigma again, and now I think it's more attractive.

Isn't it tough to go it alone and be a business starting up when no one else is trying it?

We're Americans. Entrepreneurship is in our DNA. You're right that when the economy tightens, fewer people are likely to start businesses. But what that means is that you can do a competitive regional analysis and know that your niche is protected, for a while at least. Grand openings, ribbon cuttings, and groundbreakings are likely to get a lot more media and general attention in your community.

What about marketing?

There's going to be some softening in ad rates, and again, you can take advantage of that. There's also less advertising competition, so you'll get greater visibility. And, in a down economy, writers, designers, and ad agencies are looking for work and may offer reduced rates.

The other thing we recommend is partnership marketing, where you co-market your products through someone else's database. We have a local pizza parlor owner who goes to the high school and hands out coupons to all the kids. For every coupon that's cashed in, he makes a donation to the school band. So he gets tons of kids coming in from the band, and their parents, and their friends.

So, are you in charge?

There are different types of leaders, but more importantly there are different types of leadership positions. When you are weighing a new leadership role or assessing your current one, there are four attributes that scale the leadership role. How you been in a role where you had all the accountability but no responsibility to get something done . . . not good and most likely you probably were not successful (although it can be done, but makes it difficult on you). When you examine your role or another's person role (or even your supervisor's role), think about how important or level of these attributes as it will help you think about what is ultimately important to you personally as a leader.


These attributes of the leadership position are Responsibility, Accountability, Position of Authority and Personal Power. Let's quickly talk about each one.

Responsibility is the obligation to do assigned tasks. The person is responsible for being proficient at his or her job. The leader is responsible for what employees do or fail to do, as well as for the resources under their control.

Accountability is answering for the result of one's actions or omissions. It is the reckoning, whereby one answers for his or her actions and accepts the consequences, good or bad. Accountability establishes reasons, motives and importance for actions in the eyes of the leaders and employees alike. Accountability is the final act in the establishment of one's credibility. It is important to remember that accountability results in rewards for good performance, as well as the downside for poor performance.

Authority is the legitimate power of a leader to direct staff to take action within the scope of the leader's position. The owner of the organization has the authority to make decisions.

Power is the ability to exert influence in the organization beyond authority, which is derived from position. The supervisor's personal power could include job knowledge, personal influence, interpersonal skills, and ability to get results.

If you were to set a 10 point scale for each, how would you rate yourself on your needs in the leadership role. My career coach was helpful in me thinking this through and am not doing real justice to this discussion but hope it helps you think about your leadership role and your needs to achieve what you would like.

Is Risk within you?

There have been several postings about risk taking on this blog. When you take risks, you can experience the highest of the highs, but also the lowest of the lows, that is what risk is. I found this article on risk. How large a Risk you are willing to take is within you, sometimes not taking the risk is could even be worse (this person from Russia in the article). However, most of us will not take a major risk but will step out of your comfort zone in a calculated way (and to me that is risk taking as well and actually a good thing, because you never want to look back and say "what if"). Risk-taking forces you to look to the future and not behind.

The Greatest Risks They Ever Took
Brett Nelson
Forbes.com

http://www.forbes.com/entrepreneurs/2008/10/01/jpmorgan-gucci-letterman-ent-manage-cx_bn_1001riskgreatest.html?feed=rss_entrepreneurs

What is anything worth? Easy: The amount of fear, pain and suffering you are willing to risk to get it.

But of course we know the math is infinitely more complicated--especially for those suffused with fear, greed and hubris that inevitably fog the equation.

The crisis on Wall Street, now coursing like a virus throughout the broader economy, is testament to our collective innumeracy when it comes to estimating risk. Complicating matters: a vast web of impenetrable financial contracts putatively designed to "absorb" risk (and reap billions in transaction fees) by sprinkling it throughout the entire financial system. Thanks to such securitization, thousands of people moved into homes they couldn't afford. No cash? No worries--there's plastic. And the band played on.

So the question remains: What's worth the risk? In search of illumination, we asked a slew of strivers--entrepreneurs, politicians, athletes and show-business types--what they consider to have been the riskiest moves of their lives.

Their responses were as diverse as their careers, but all support the same conclusion: The best results come to those willing to take a chance--an important reminder for entrepreneurs, financiers and political leaders as the global economy braces for even rougher weather.

Several subjects spoke of moments when their careers hung in the balance--the sputtering start-up, a challenging job offer or the decision to walk away from what they knew to pursue far grander dreams.

Some sneered at death, or at least dismemberment. Take Kit DesLauriers, the first person to ski from all seven summits. Of her descent from the top of Mount Everest, she says: "There were no safety nets, no fixed lines established, freezing winds. We had to spend an unplanned night at 26,000 feet, with very little food and water. The next day, we skied the Lhotse Face, 5,000 feet of blue ice on a 50-degree slope ... At one point, we ran out of oxygen. I kept telling myself: 'Don't sit down and die. Just keep going.' It's really easy to let your mind get a hold of you, but the journey taught me we are much more than our minds."

In 1992, Puneet Nanda, chief executive of Dr. Fresh, maker of oral care products, then based in New Delhi, decided to brave the burgeoning Russian market. "Everybody there had to pay a Mafia fee," he recalls. "These ex-KGB guys controlled everything."

One day, he continues, a new Mafia boss came by and chopped off his office manager's hand; later, thugs roughed up Nanda in his own home. Nanda fled Russia, but not the fight. Dr. Fresh products now sell in 42 different countries--including, just as of August, Russia.

Richard Jackson, chief executive of Jackson Healthcare--which provides clinician staffing, anesthesia management and heath-care IT services for U.S. hospitals--has a story for risk-taking entrepreneurs hunting for suddenly cheap assets. Two years ago, Jackson decided to acquire World Health Alternatives, a publicly traded medical-staffing firm which was then twice the size of Jackson's company.

Jackson recalls: "It was a hairy deal: [World Health] was pulling in $300 million in annual revenue but losing $1 million per month and rapidly approaching bankruptcy; its financial documents were inaccurate, the CEO had quit after some suspicious ethical behavior and the FBI was getting involved. But I believed we had the industry expertise to turn the business around. We paid $43 million for the company in 2006; last year, it took in $18 million on $220 million in sales. It was a huge risk--and an even bigger success."

Michael Chasen, co-founder of Blackboard (nasdaq: BBBB - news - people ), an education technology company, went so far as to jeopardize his new marriage. Despite making nice coin at KPMG, Chasen and college buddy Matthew Pittinsky decided to start their own company making software to facilitate instruction at schools that were outfitting fully Internet-wired classrooms and dormitories.

"The biggest risk was telling my fiancé one month before our wedding that I was going to quit my high-paying job to gamble on a 'big idea' with my old college roommate," says Chasen. "Not exactly what she had signed up for." (Happy ending: They still tied the knot. "Risk averted," he adds.)

Still others we spoke with considered smaller, even mundane challenges to carry enormous risk. Case in point: Brian Binnie, whom Forbes.com interviewed for the first iteration of this article in 2007. Binnie piloted the craft that rocketed 69 miles above the earth in pursuit of the $10 million Ansari X Prize, funded by the likes of First USA Bank, a unit of JPMorgan Chase (nyse: JPM - news - people ), and author Tom Clancy.

Ironically, the sky-scraping aviator's greatest risk was among the most down-to-earth: speaking in front of a public audience. "The choice between a poke in the eye or the opportunity for public speaking sends me into serious deliberation," admitted Binnie. (Still, an invitation to appear on The Late Show with David Letterman proved too tasty to pass up.)

Who better to assess risk then a guy who gets paid big bucks to do just that? When asked last year about his greatest risk, gold-plated venture capitalist Tim Draper, co-founder of Draper Fisher Jurvetson, recalled not one of his sizable bets on a promising (but by no means proven) young company; rather, he mentioned the time he mustered the courage to board an unknown, unsaddled horse.

"I don't remember all the risks I have taken, since if they worked out, they were no big deal," said Draper.

That's one way of looking at it.

Joke of the Weekend XXIV

A crow was sitting on a tree, doing nothing all day. A small rabbit saw the crow, and asked him, "Can I also sit like you and do nothing all day long?"

The crow answered: "Sure why not." So, the rabbit sat on the ground below the crow, and rested.

All of a sudden, a fox appeared, jumped on the rabbit and ate it.

Management Lesson:
To be sitting and doing nothing, you must be sitting very, very high up.

How long will your market be around?

I just like this article. It contains how a business can survive through excellent service while others vanish in a technology disruptive environment.

The Last Typewriter Repairman?
Gramercy Typewriter has survived by diversifying into laser printer repairs, but its reputation for customer service has been its saving grace
by Stacy Perman
Businessweek.com

http://www.businessweek.com/smallbiz/content/sep2008/sb20080925_900705.htm?campaign_id=rss_smlbz

Every business day, as he has done for the past 49 years, Paul Schweitzer, 69, travels the streets and skyscrapers of Manhattan making "house" calls, carrying his black leather tool bag by his side. Schweitzer, who insists on wearing a suit and tie while on his rounds, is one of the last of his kind: the typewriter repairman.

In 1932, Schweitzer's father opened Gramercy Typewriter in Manhattan, selling and repairing typewriters. "At one time, there were millions of typewriters in the city," says Schweitzer, who began working for the family business in 1959 and took it over when his father retired in 1975. "You would go in an office and there were a hundred desks and each one had a typewriter," he says.

Over the years, Gramercy earned a reputation for quick repairs and excellent customer service. The elder Schweitzer gave out wooden rulers that bore the company's name and logo as advertising. The shop's client base spanned from the tip of Wall Street up to the top of Harlem.

Surviving the IBM Selectric
The Schweitzers were quick to adapt to changes. The first big one came in 1961, when IBM (IBM) introduced the Selectric typewriter. The Selectric used a typeball that could be changed to display different fonts. The ball replaced the traditional pivoting type bars and the need for a moving carriage with a paper roller. Gramercy, like every other repair shop, had to learn how to fix and overhaul the new machines. Aside from new iterations of the Selectric, for the next 30 years, the typewriter business remained relatively steady.

Then came the introduction of the personal computer in the 1980s. Gradually, businesses began replacing their typewriters with desktop computers. By the early 1990s, the shift practically had made the typewriter obsolete. A number of Gramercy's competitors went out of business. "When I started, the Yellow Pages had six pages of typewriter repairmen, today there is maybe half a page," says Schweitzer. "If an office had 200 typewriters, now they had 40," he says. Although the number of machines continued to dwindle, "They still needed repairs." Gramercy gained business as other repairmen shuttered their shops.

While Schweitzer carried on, he noticed that most of the offices that he serviced were purchasing Hewlett-Packard (HPQ) laser printers along with their computers. Recognizing that those printers would break down and need repairs, Schweitzer took Hewlett-Packard-sponsored training courses to learn how to fix the machines and added that to the firm's service menu. Before long, he included fax machine repairs as well. As Schweitzer made his rounds, he informed customers that he was also available to repair these office staples. Schweitzer, who to this day has never owned a computer or used e-mail, says diversifying has allowed his company to retain a good number of its clients, with about 75% of the business now involving printer repairs.

New Interest in Typewriters
Despite these dramatic shifts, Schweitzer insists there is a surge of interest among young people who have found their parents and grandparents' old typewriters in basements and attics and have taken to the machines. At the same time, he says a market has developed around buying and selling typewriters online. Schweitzer also says that many of the offices he services still use the old machines for certain kinds of documents and customers still stop in his shop throughout the week. On a recent afternoon, an older gentlemen trudged up to the fourth floor of Gramercy to explain that his IBM Selectric was broken and inquired whether it could be fixed. Another recent customer was an artist who created an entire art exhibition using a manual Royal typewriter from the 1930s and in doing so ended up busting the star key.

These days Schweitzer spends most of his mornings doing house calls. By noon he returns to his shop and eats lunch, and if there are no more office stops to make, he dons a blue apron and works on typewriters in the back-room workshop, then knocks off around 4:30. There, the walls are lined with old IBM Selectrics and boxes stacked with parts and ribbons. Scattered about are a handful of old Underwood, Corona, and Royal manual typewriters from the 1920s and '30s. The work he does on typewriters now consists mostly of chemical washings and replacing parts like keys, feet, and ribbons from hard-to-find manufacturers.

Schweitzer says he continues to run his business because he enjoys it. He says walking up and down subway stairs carrying his 30-plus-pound tool bag has kept him fit throughout the years. Not ready to retire, Schweitzer still takes enormous pride in being able to bring old machines back to life. Recently, he overhauled a broken 1920s-era Underwood that a customer wanted restored to working order as a birthday present for her husband.

"Hanging In There"
Although he hopes to pass the business on to his son, Justin, Schweitzer has been around long enough to know another shift or two is ahead. "I'm thinking, what is the next thing after printers?" he says. "Maybe they will be voice-activated? Or maybe people will get so disgusted with the breakdowns and failures they'll go back to IBM typewriters. I'm waiting to see what happens next. We're hanging in there."

Ideas are "cheap"

Everyone has ideas. You have been there. In a "brainstorming" meeting, ideas are following all seem great and will make the unit bigger, better and "more money". After the meeting, everyone goes back to their day job . . . until the next brainstorming meeting when similar ideas are discussed.

Have you ever had that feeling that if one more person brings you another great idea, you will go crazy. It is hard enough to get the stuff done on your current to-do list.

The point is ideas are "cheap" but implementation is hard. You must undergo real changes to the manager/workforce to make it happen!

In a book called "Management of the Absurb" by Richard Farson, it discusses how we stifle creativity and the change that needs to happen in the follow ways:
1. We play intellectual games
"define that term", "on what authority do you make that claim?"
2. We judge and evaluate
"it was better the last time" (he also mentions thta both managers and employees dread evaluations that performance reviews have come to have nothing to do with actual performance . . . I am not so sure about that, but could see if for some)
3. We deal in absolutes
"we've always done it that way" or "we dont make exceptions around here"
4. We think in stereotypical ways
"men are rational, women are intuitive". All of these stereotypes condition our reactions and make it difficult for us to see the possibilities for change.
5. We don't trust our own experience, and we train our employees not to trust theirs. We tell them, "you're not ready to take on that responsibility," and gradually they do come to disregard their own experience and defer to the judgement of others.

If you do the same thing in the same way, you will get the same results. If you have a "great" idea, you, management, and the organization must adapt and change to make it a reality, otherwise, nothing will be different.

Interestingly, the people who do implement change or are willing to change are the ones that sometimes end up being on the outside looking in

Selling in Tough Times

I found this article and thought it was relevant to some recent postings on leading in tough times. While I do not believe salespeople should be the first to get whacked (unless they are not performing well), there are some interesting insights here. I do believe that the Software as a Service (SaaS) is an excellent opportunity for companies producing them and those clients that want lower cost of ownership for software applications.

How To Sell In Tough Times
Glenn D. Porter
Forbes.com

http://www.forbes.com/entrepreneurs/2008/09/30/sales-energy-software-ent-sales-cx_gp_0930glennportertoughtimes.html?feed=rss_entrepreneurs

Salespeople are often the first to get whacked when the economy goes south.

But here's some good news for busted Wall Streeters--and any other commission chasers laid low by the latest economic crisis: Salesmanship is a transferable skill.

If you can sell stocks, bonds and financial derivatives, you can sell real estate, technology, autos and tooth brushes. That's because the fundamental tools are the same.

Salespeople know how to frame a discussion. They know how to ask the right questions and, with a little discipline, shut up and listen to the answers. They can relate to people. And they have the courage to ask for business and try new things.

So what happens if--and when--you lose your job? First, you go have a martini and a big steak dinner. Then you look for a growing market to attack.

So where's the growth? In tough times, any product or service that promises to boost productivity (or to save money, however you want to look at it) is worth a look.

Some promising areas: alternative and sustainable energy sources, such as wind power. (Old company raider Boone Pickens imagines massive fields of wind mills in the western U.S.) Such an infrastructure requires engineering, construction, software, spare parts and maintenance providers--they all need salespeople.

The same goes for battery and bio-duel technologies. We don’t know who will win the alternative-energy game, but we do know there will be plenty of competition for years to come.

Another hot area: software as a service. SaaS providers charge monthly subscription fees, rather than more expensive upfront licenses--a cash-flow booster for small businesses in tough times. Some of the fees are so low you can use a credit card to cover them.

Not that you should forget the old standbys: companies that sell to public utilities, educational institutions, health care and infrastructure providers. We're not talking "credit default swaps" or other sexy doohickeys like that, but you want to put a decent dinner on the table, right?

For those still on the payroll, get in touch with your loyal (and solvent) customers. Immediately. Anticipate how the troubled economy might affect them, because it will.

Preempt trouble and engender even deeper loyalty by crafting some new pricing schemes. Take another look at long-term contracts. Assuming they haven't fallen on especially hard times, find creative ways to allow valued customers to keep buying. Worse case scenario, accept products or services in lieu of payment.

A final thought in this environment: Watch receivables like a hawk. Your commissions depend on it. You don't have to whip out the bludgeon, but a sales pro should be able to politely squeeze a customer's payables department.

I'm not going to kid you: Things aren't looking good out there. But it doesn't matter. Because no matter what, salesmen do one thing: They sell.

So stop reading and pick up the phone.