Recent Gen-Y Startup Successes are an Emerging Era

The business world has been watching this emerging generation with trepidation, and a lot of people haven’t been sure who would be the winners, and who would be the losers. Can Gen-Y, much less the new Generation Z (1995-2010), survive as entrepreneurs, and do they have the passion and commitment it takes to run a startup and attract investors?

My own perspective is that the recession was good for Gen-Y (Millennials), because it forced them to face reality, often for the first time in their life. In the last few years, even college grads with advanced degrees don’t have job opportunities waiting for them. But I’m happy to report that I see more and more of them impressively stepping up to the entrepreneurial plate.

It now reminds me of previous generations, per the qualms raised about Gen-X back about 20 years ago, and about the Baby Boomers some 20 years before that. Yet now Gen-X’ers are seen as the major facilitators of change, and Boomers are the angels and business advisors for hot new startups.

We should look ahead to capitalize on evidence of the positive attributes of Gen-Y from a business perspective, including the following:

• Confidence. Raised by parents believing in the importance of self-esteem, they characteristically consider themselves ready to overcome challenges and leap tall buildings.

• Goal and achievement oriented. Many Gen-Y’ers approach the business world with solid personal goals. They expect to create something that is technically challenging, creative, fun, and financially rewarding.

• Multi-cultural. They expect to succeed in a workplace that is fair to all, where diversity is the norm—and they’ll use their collective power if they feel someone is treated unfairly. Diversity is a key to innovation, and big new business opportunities.

• Socially conscious. They were taught to think in terms of the greater good. They have a high rate of volunteerism. They expect companies to contribute to their communities—and to operate in ways that create a sustainable environment.

These attributes have already driven several well-known Gen-Y startups, like Facebook, Zappos, and Groupon. Yet it’s too early to totally forget the potential shortcomings and idiosyncrasies of Gen-Y. According to Winograd and Hais, there are still some of worrisome attributes relative to the role of entrepreneur:

• Need to be scheduled. Gen-Y’ers were tightly scheduled as children and used to a full schedule of structured activity. Many still struggle with handling free time and time management in general. A startup is the most unstructured entity I know.

• Minimal “street smarts.” They grew up in a time of increasing safety and protection (car baby seats, no failing grades, no walking to school). They were rarely left unsupervised. They may have good academic credentials, but less business sense.

• Consensus driven. Gen-Y members have been reared in a way that makes it difficult for them to conduct business negotiations in an entrepreneurial manner. Rather than seeking to come out on top in zero-sum games, Gen-Y strives for consensus.

My challenge to Gen-Y, and to the rest of us, is to capitalize on the positive attributes and continue to work on overcoming any remaining negatives. I’m still convinced that “real change only happens when the pain level gets high enough.” The past pain level has been high, but the business climate has improved, so let’s not slip backward.

Gen-Y is now experiencing their wake-up call, just like previous generations did with Vietnam and the 1980 recession. From the quality of interactions I’ve had recently mentoring a number of Gen-Y members, I’m happy to report that many are emerging as the new entrepreneurs of the digital age. I’m sure you agree that we need them to fuel the wave.

Marty Zwilling

6 Strategies for Transforming Ideas Into Results

Successful startups are all about turning ideas into action quickly and efficiently. These actions must be the hard part, since entrepreneurs always seem to come to me with ideas, and ask me for help on the actions. That has always seemed strange to me, since the magic is supposed to be in the ideas, and the actions are the same for every business.

In fact, the actions required to start and run a business are well documented, the subject of many books, and taught in college courses across the land. As confirmed to me by John Spence in his book on this subject, Awesomely Simple, turning business ideas into action consists of six essential strategies:

1. Build a vivid vision. Having a clear, vivid, and compelling vision in your head is without question an essential component in building a successful company. But that’s not good enough. The vision has to be documented and communicated in a way that makes it vivid to every member of your team, your customers, and your investors.

2. Team with the best people. The best people are highly talented and motivated individuals who are also masters of collaboration. The future of your startup is directly tied to the quality of talent you can attract and keep. You must create a winning culture that people love.

3. Practice robust communication. Open, honest, frank, and courageous communication, both inside and outside the organization, is critical. The key skills can be learned, and include deep listening, logic versus emotion, and reading body language. According to Spence, this is the biggest problem he has to deal with in client organizations worldwide.

4. Cultivate a sense of urgency. Get things done. A fast, agile, adaptable organization makes the important things happen now. Urgency is allergic to bureaucracy. Reward fast action. You set the model for your startup. You become what you focus on and become like the people you spend time with.

5. Enforce disciplined execution. Build a performance-oriented culture that demands quality in every operation, encourages continuous innovation, and refuses to tolerate mediocrity. Most organizations execute only 10 to 15 percent of their major goals. Do a periodic effectiveness audit to check your operation. Then fix it.

6. Show extreme customer focus. Put feedback mechanisms in place to know that you are consistently delivering what customers truly value. Attitude and listening are the keys. Superior customer focus can drive as much as an 85 to 104 percent increase in your profitability.

It should be pretty easy to see the interdependence and synergy among the six principles, each building on the next, all the various elements working together to create a highly successful business. But you don’t have to go out and address all six principles right now. Pick one that will create leverage immediately, and begin with it.

Spence defines three simple watchwords that will lead to business excellence – focus, discipline, and action. If you are missing any of these, the outcome will most certainly be mediocre. Once you start accepting mediocrity, you become a magnet for mediocrity.

Your great ideas deserve more than mediocre actions. Simple actions done in an outstanding fashion are far more effective than complex and time consuming actions done poorly (thrashing). Also, don’t be fooled into thinking that “simple” means “easy to implement”. Start now to turn your innovative ideas into action. Every entrepreneur loves a challenge.

Marty Zwilling

How an Entrepreneur Can be Open But Stay In Control

The emergence of social networking and the Internet has caused a new focus and value on “openness,” which leads to a new element of leadership, called “Open Leadership.” The mantra of open leadership is “Be Open, Be Transparent, and Be Authentic.” This is counter to the traditional business premise of “control,” so many companies are still pushing back.

Charlene Li, in her book “Open Leadership,” shows leaders how to tap into the power of the social technology revolution and use social media to be “open” while still maintaining control. I support her ten elements of the basic framework and vocabulary of open information sharing and open decision making:

1. Explaining: creating buy-in. This element is sharing information through the new video, audio, and interactive media about, and the logic behind decisions, direction, or strategy with the goal of gaining buy-in to the idea so everyone is working toward the same goal.

2. Updating: capturing knowledge and actions. New publishing tools, like blogs, collaboration platforms, and even Twitter provide updates that are easily available. These have the added benefit of being searchable and discoverable.

3. Conversing: engaging in a dialogue with others. Employees can share best practices with customers on social network platforms and customers can help each other. When done well, an organization’s online community can become a competitive advantage.

4. Open microphone: encouraging participation. Everyone and anyone is welcome to contribute through new collaborative tools with no preconditions. Search, combined with ratings and reviews become key in separating the useful from the rambling.

5. Crowdsourcing: solving a specific problem together. The goal here is to grow the sources of new ideas and gather fresh thinking to create a new product or service. It can also be for solving everyday problems, like logo design or open source code.

6. Platforms: setting standards and sharing data. Ebay is an example of open standardizing on how items are listed and how transactions are handled, enabling millions of individual sellers. Common platforms enable open data access at any level.

7. Centralized. The key challenge of making centralized decision making more open is to open up information sharing in both directions, so that those in power have the right information and also have the commitment to share it back out to the organization.

8. Democratic. Increasingly, voting is used to allow people to choose from a set of equally viable options, with the result is that employees feel a greater sense of ownership in the process. This is also becoming prevalent in decisions with customers on products.

9. Consensus. Social technology tools now allow this process to be done quickly and less chaotically, with tremendous buy-in from everyone affected. This process works well in today’s extremely flat and non-hierarchical startup organizations.

10. Distributed. This is a hybrid of all the preceding decision processes, in that it pushes decisions away from the center to where information and knowledge actually reside, typically closer to the customer. This mode requires more discipline and planning.

I’m still waiting to see how all this works out in real life. The challenge is to be open without abdicating all control, or spiraling into chaos. Hopefully, by embracing social media rather than banning it, leaders can transform their organizations to become more effective, decisive, and ultimately more profitable in this new era of openness in the marketplace. What do you think?

Marty Zwilling

Inspiration Without Perspiration is a Dull Startup

I’m fully convinced that both inspiration and perspiration are always required in a startup. Yet many people seem to be stuck on one end or other of this equation – all perspiration with no dream, or all inspiration with no reality. Success is the right balance of both for fun and profit.

Aspiring entrepreneurs ask me why their great idea hasn’t sold; they talk about it endlessly, and they expect others to do the development, finance, and marketing work for them. Those at the other extreme don’t look up from the grindstone long enough to notice whether all their work is producing sweat equity or just sweat.

Starting a business may be fun, but it’s not easy. No matter how many times you’ve done it – the stresses are tremendous. It can also be very inspiring, as you watch your dream morph into reality, or as you feel each little element of success:

• Watch your team develop new skills. There is nothing more inspiring than seeing the results of your mentoring and leadership. Your own learning should be the biggest inspiration of all.

• Your solution fills a real market need. Truly satisfied customers are a joy to every business person. Watching the orders come in, or the product moving off the shelf, is the feedback you have been looking for.

• A business model that works. You have figured out how to undercut your competitor’s price, and still hold your margin. Taking that first salary after a long dry spell is an inspiring moment, and a great celebration with friends.

• Love that sustainable competitive advantage. Working on that unique design, or completing the breakthrough for an innovative patent, are moments of inspiration that you will never forget, especially if they become your competitive edge.

• Bask in the success as it happens. Maybe it’s that first customer testimonial, or that first congratulations from someone you respect, or seeing your story in the newspaper. You knew all along that you could do it.

Of course, never forget those ongoing perspiration items that seem to haunt you every day:

• Create intellectual property. Incorporate, register your domain name, trademarks, and copyrights, then patent if possible. Reserve the same names on the leading social networks and blogs.

• Marketing is top priority. Start even before the product is ready. Word of mouth advertising and viral marketing cost big bucks these days so budget for it. It takes leverage, effort and money to get in the public eye and stay there.

• Reign-in expenses. Review every expense with a miserly hand. Do not delegate this task! Make every effort to do things “in house”, rather than rely on outside services, accountants, and law firms.

Though innumerable factors are a part of every success, it’s arguable that the ratio of effort to inspiration can make the difference between just spinning wheels, on the one hand, and ideas that never come to fruition, on the other.

Some say the Internet is a metaphor for our brains. Both are networks. Maybe inspiration is feeding your brain as much information as possible and then figuring out how it connects when the time comes. Perspiration is the lubrication to keep your senses open to all the possibilities.

Marty Zwilling

10 Entrepreneur Risks Worth Taking in Every Startup

Being a risk taker in business is not the same as being reckless. Nevertheless, the word “risk” has a negative connotation to most of us, implying danger and possible loss. For true entrepreneurs, risk is viewed as a positive, with its implied challenge to overcome the unknown and hitting the big return.

In fact, risk is an integral part of life, as well as every business, yet so few people learn to manage it properly, or even want to think about it. One way to learn is to understand better how successful entrepreneurs approach risk, and look at actual strategies they use for success.

I found a great summary of key strategies used, with life stories, in “The Risk Takers,” by Renee and Don Martin. Here is their list, with a little prioritizing and comments of my own:

1. Spot a new trend and pounce. Often, a shift in cultural or economic trends will create new entrepreneurial opportunities. The challenge is to recognize the shift early, and then act on it, despite the risk. This is the origin of the “first movers” competitive advantage.

2. Go on a treasure hunt and find an under-served niche. Even a huge multi-billion-dollar company can’t offer everything for everyone. There is nothing more exciting than finding a lucrative market that everyone else has failed to spot or target.

3. Exploit your competitor’s weakness and make it your strength. The sharpest entrepreneurs have a knack for viewing the world from the perspective of their customers. That quality can help you capitalize on competitors vulnerabilities and shortcomings.

4. Hit ‘em where they ain’t. Whenever possible, set your sights on areas that your competitors have neglected or ignored. It’s easier than dislodging well-recognized existing products, and waiting for customer change, even if your solution is better.

5. Buck the conventional wisdom. Many entrepreneurs profiled in the book succeeded in large part because they veered away from established formulas and ways of thinking. Challenging convention can open the door to competitive advantage.

6. Save your bucks and get notice without expensive advertising. If your startup business is on a tight budget, there are creative ways today to get customers’ attention without traditional advertising. Start with social media, blogging, and word-of-mouth.

7. Never let adversity or failure defeat you. The ranks of successful entrepreneurs are filled with men and women who refused to stop believing in themselves, despite the derision of others or heartbreaking failures. Persistence and resiliency lead to success.

8. Trust your gut. An expanding body of research confirms that intuition is a real form of knowledge. It’s a skill you can develop and strengthen – one that’s particularly valuable in the most chaotic and fluid business environment. At such times, intuition often beats rational analysis.

9. Never stop reinventing your company. Top-performing entrepreneurs make it a point to give their business a major overhaul now and then to keep pace with changes in the marketplace. Complacency in business is like a slow leak in a tire. By the time you notice it, the damage is done.

10. Just start! The “perfect” time for a business launch will never present itself. More often than not, waiting just gives would-be competitors the opportunity to beat you to the punch. If you truly believe your idea will succeed, then take the risk and just get started.

We have always been a world of entrepreneurs, and if we are to rebuild our economy, we must reinvigorate the culture and mind-set that have built that tradition. Believe in the power of your ideas and just start the pursuit of you own entrepreneurial dream. With intelligent risk, you too can succeed.

Marty Zwilling

For Entrepreneurs, Conversations Are All Business

Whether you are trying to motivate your team, close a deal with a customer, or get funding from an investor, a casual conversation is usually a waste of your valuable time. These result is a founder who is always “too busy,” but never seems to get the business done and the team moving. All real business is conversations focused on creating results.

Shawn Kent Hayashi, in her new book “Conversations That Get Results and Inspire Collaboration” makes my point very well as she outlines the top twelve types of conversations that relate to working together in business, and provides tips on how to make each of them more effective for all concerned:

1. Conversation for connection. Connecting with others happens when we slow down our talking enough to be in the present and really listen to one another. Rapport building requires listening, more than talking. Powerful listening causes trust to grow.

2. Conversation for creating new possibilities. The questions a manager or colleague asks help us to understand a situation better, if we ask good questions and really listen to the answers. Conversations can also be the triggers to professional development.

3. Conversation for structure. When we know what we want to create, the next step is to devise a plan. We build our plans with the steps as we become aware of them through conversations, with ourselves as well as with others.

4. Conversation for commitment. For each identified action step, we identify potential candidates and then seek their commitment to produce the result that corresponds to the task. The commitments we make to ourselves are the most fundamental.

5. Conversation for action. What actions will make your tasks and goals come alive? We’ve all seen people get stuck in a project because they do not know what to do next. They’re not asking themselves or anyone else the right questions, and not listening.

6. Conversation for accountability. After a conversation for commitment has occurred and the expectations are clear, being accountable for engaging others in what you want to do is a sign of respect. Sometimes people need to be guided into better outcomes.

7. Conversation for conflict resolution. Many people will avoid conflict in work relationships at all costs, which is nonproductive. Others feel fear when the smell of conflict arises. A few overuse this conversation type. Conflict is normal, so deal with it.

8. Conversation for breakdown. Anger indicates that something or someone has crossed one of our boundaries, and is a signal to address the issue. Breakdown recognition is vital to moving forward. Asking for what we want might actually clear up the breakdown.

9. Conversation for withdrawal and disengagement. It is unrealistic to think that all work relationships will be enjoyable or friendly forever. Often it is best to end a tenuous connection, so that we can invest our time in ones that are meaningful and productive.

10. Conversation for change. Your ability to change the direction of an individual, team, or an investor occurs through conversations. By design, you can change the conversation in the office, at board meetings, and with peers who seem to have gone off track.

11. Conversation for appreciation. Think of the last time you felt really appreciated at work. Undoubtedly someone showed appreciation of your efforts using language that works for you. Affirming others through conversation builds relationships and momentum.

12. Conversation for moving on. You have conversations for moving on when leaving a community or transferring or retiring from a company. One day you might reconnect, but for now you have closure, with no expectations of future conversations.

Being successful as an entrepreneur begins in a conversation with ourselves first, and then extents to others, focused on what we are passionate about, and the solutions we are bringing to market. None of these are casual conversations, where you don’t really listen to the response. How committed are you when someone is obviously not listening to your responses?

Marty Zwilling

7 Rules for Savvy Customer Service Required Today

Customer service has always been reactionary, meaning someone has to wake up and answer website email requests. That’s just not savvy enough to hold today’s fickle, less loyal, and ready to jump customer. Great startups are getting ahead of the game with “anticipatory customer service,” like providing smart phone access to product and account data to head off complaints. This exemplary customer service is just savvy marketing.

Self-service technologies, social media, and smart phones have created a new set of expectations for high-tech consumers today. You should assume that they will want discounts to match competitors, and answers to technical questions in real time, rather than waiting in some phone or mail queue.

Thus you need a new generation of self-service that goes way beyond the now old-fashioned and frustrating automated phone audio response messages. I found a good summary of these new expectations in a book recently published by Micah Solomon, “High-tech, High-touch Customer Service.” Here are seven rules derived from his insights to start your thinking:

1. Customers expect a choice of channels. Customers should never be told by a clerk to call customer service, or told on the phone to see the website. You need to anticipate the channel they might choose, and be ready to handle it, or they will look elsewhere, and trash you on Twitter and Yelp.

2. Self-service needs to have escape hatches. It’s time to end the automated email responses with the “do-not-reply” address. Always end self-help postings with “Did this answer your question?” and provide a next step for those who answer “No.” That means guiding your customer to the top, rather than hiding the top decision maker.

3. Respect your customer’s view of usability. Usability is recognizing what users have learned from past experience, rather than an abstract science. So don’t move the search bar from the top of a web page, or select a digit other than “0” for getting a human on the phone. Scientific updates to your interface to reduce keystrokes may be self-defeating.

4. Customers need to be able to shift channels without regression. How many times have you shifted from automated response to a human, and been asked for all the information anew? Anticipate this, and use today’s technology to make the experience seamless. You probably won’t get a second chance.

5. Self-service has to be monitored and updated regularly. Customer expectations go up as rapidly as the delivery technologies change. Social media apps like Twitter and Pinterest are the latest sources for what’s catching people’s attention today, both positively and negatively. You should be watching.

6. You and your staff need to regularly use your self-service channels. For the staff, they need to understand customer issues, and you need to test the tone and culture of the people behind the scenes. It’s getting tougher and tougher to outsource this tone and technology to other cultures halfway around the globe.

7. Ugly upsells through self-service are a brand killer. Amazon handles upselling in a gently suggestive way, with a “frequently bought with” message. Harder sells can backfire, since people like to be pulled in with personalized messages, rather than pushed along with the crowd.

Technology is great for adding speed and flexible delivery to anticipatory customer service, but people are still required to add the heart and the personal touch. More than ever, a startup needs to build an emotional connection with every customer. Reactionary customer service won’t generate the loyalty you need to survive. When was the last time you took a hard look at your service?

Marty Zwilling

Disclosure: This blog entry sponsored by Visa Business and I received compensation for my time from Visa for sharing my views in this post, but the views expressed here are solely mine, not Visa's. Visit http://facebook.com/visasmallbiz to take a look at the reinvented Facebook Page: Well Sourced by Visa Business.

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