Wednesday, July 31, 2019

Don’t Wait To Catch Up Until Your Customers Hate You

customers-hate-your-businessAfter working in business at all levels, and consulting to entrepreneurs for years, I’m still surprised to see so many situations where things that should be easy are painful to customers, and lead to customers hating your business. How could any rational employee or executive fail to do his or her job, not realize there is a problem, or not care enough to even try to do the right thing?

For example, I recently picked up my phone to call a well-advertised local company for a TV repair. After several iterations of not answering their phone, forgetting a promised callback, to admitting they couldn’t help me, I had no interest in trying them ever again. They don’t realize that their image of incompetence will likely get shared with twenty or more other potential customers.

Of course, every business owner I know will loudly proclaim that could never happen on their watch, but secretly they are not so sure, and would like to know how to prevent it. If you are in that category, you should take a hard look at a new book, “Nincompoopery: Why Your Customers Hate You--and How to Fix It” by John R Brandt, who has some real insight on this problem.

He defines “nincompoopery” as the ill-planned, outdated, or ludicrous organizational structures that turn even the most eager employee into a nincompoop, or at least force him or her to seem like one. He outlines six key macro-trends in business today which makes that make this an ever-growing challenge for leaders, and offers some real guidance on how to mitigate the impact:

  1. Leaders still reeling from competition and recession. Accelerating worldwide competition and financial upheavals are undermining established market positions. You can’t wait, look the other way, and hope things return to normal. Every business leader needs to focus on continuous learning, adapting, and being the role model for the team.

    For example, it’s time to regain your optimism, based on new global opportunities now open, healthcare changes, and the power of new technologies, including the Internet-of-Things (IoT). Get out and meet your customers to learn what turns them on these days.

  2. Data-fueled automation requires big skill changes. Connectivity and the ability to mine insights from a data-rich environment can be a huge boon to productivity and profits, or a barrier that will drag you and your team into nincompoopery. Start now looking for and providing advanced training and tools for all team members.

  3. Workforce demographics quickly changing. Remaining baby boomers are making the entire workforce older, while the percentage of women and the mix of ethnic diversity is increasing. Leaders who want the best results must rethink and change now how they find, train, compensate, and retain the best talent – regardless of age, color, or gender.

  4. Different employee work balance expectations. The new generation of workers expects to work more flexible hours and to connect from anywhere. They demand to be empowered to make life tradeoffs, such as vacation scheduling and benefit options, as well as business decisions. Employee engagement is keyed to these expectations.

  5. Economic/social trends demand new employee contract. We now live in a gig economy, where both employers and employees want additional flexibility. The days of working hard and expecting lifetime employment with a retirement plan are gone. You must become the employer of choice, based on incentive and employee-perceived ROI.

  6. Worldwide government regulations complicate process. Customers are demanding more from their public governing units, as well as the businesses that serve them. For example, they want environmental sustainability, safe labor practices, and social responsibility. You need to set these priorities high in your strategic planning focus today.

Ignoring them until later leads to nincompoopery, and recovery is much more difficult than getting it right the first time. Start today in modeling the activities of recognized leaders in this area, including Whole Foods, Toms Shoes, Warby Parker, and Patagonia.

Don’t wait until your current customers hate you, to start reacting to these trends, and trying to build new processes, a smarter team, and more innovative solutions to fend off the curses of nincompoopery.

These real requirements for business success haven’t changed in a long time. Don’t let the challenges we all face today distract you from delivering a positive and memorable experience to all your customers.

Marty Zwilling

*** First published on Inc.com on 07/17/2019 ***

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Monday, July 29, 2019

9 Success Inhibitors To Overcome For Rapid Growth

graph-rapid-growthA common complaint I hear from my startup clients and many entrepreneurs is that rapid growth is more difficult than ever anticipated. The assumption usually is that more money is needed for marketing, or another round of new development is needed on the product. Yet I find in digging deeper, the challenge is just as often getting the right people and culture, rather than money.

Recently I found a new book, “The Success Cadence,” by David Mattson, Tom Schodorf, and Bart Fanelli, which summarized well the people and culture challenges, and how to overcome them. Although their focus was primarily on the sales team, I believe that many of their key success inhibitors, including the following, apply equally well to all functional areas of your team:

  1. Some team members have an entitlement mindset. The entitlement mindset is a failure of accountability. If this is left unchecked, the concept of we-first is destroyed, where too many are looking out for number one, and too few are looking out for your business. Rapid business growth requires that everyone pulls together.

    The solution is more focus on rewarding accountability, and parting company gracefully with those who insist on being me-first. Set clear standards and expectations during team meetings, and set a personal example through your own leadership behavior.

  2. Inconsistent messages from top leadership. Sometimes top leaders send messages, by their actions and emotions, that are inconsistent with published goals and priorities. For example, a “quality first” message is negated if you minimize testing to reduce product costs. Ask for feedback from the team to confirm key messages are consistent.

  3. Increasing evidence of organizational silos. Teams that don’t interact effectively decrease productivity, impede communication, and make rapid growth impossible. Your solution is to make sure every group is pursuing the same objectives and strategy, implement consistent measurements, and make leadership changes as required.

  4. Assume a better product is the primary key to growth. Some company founders believe a stronger product will solve all growth problems, including silos and lack of marketing. The solution is to listen carefully to all constituents and customers, and build a balanced action plan, eliminating hubris, and strengthening all business soft spots.

  5. Evidence of ineffective hiring and recruiting. The reality is that bad hires are a huge constraint to growth, and they are expensive and time consuming to fix. The solution is to always be hiring and developing people, including diversity of thought, background, and operating style. Existing mistakes need to be acknowledged, and off-boarded tactfully.

  6. Trying to operate with too much or not enough process. Teams bogged down by slow growth are usually stuck in one of these extremes, typically as a result of founder inattention or lack of experience. Audit each group to look for processes that everyone agrees can be improved. Prioritize process improvements and quantify results.

  7. Making decisions without discipline and analytics. What you need to manage growth is real data and tools, aligned with your targeted goals and objectives. Define an inclusive decision-making process, become the role model for discipline, and teach direct reports to follow your example. Making gut instinct decisions in today’s complex world is folly.

  8. Not measuring outcomes that tie to business objectives. Counting trade shows or opportunities typically doesn’t relate to bottom-line growth. Focus your efforts first on identifying the perfect target customer, and then define and track the activities required to close. Find your leading indicators of growth, rather than measuring lagging indicators.

  9. Lack of training and misaligned training initiatives. Companies trying to sustain rapid growth, with normal business crises, often forget that training must remain aligned and a priority. Unless you invest in, initiate, and sustain a learning growth culture, your people will be de-motivated, and not be equipped to lead when their engagement is most critical.

As your new business ramps up, anticipating rapid growth, even an existing strong workplace culture and team spirit can get lost in the fray, just when their value is most needed. Cash flow is critical, deadlines loom, and stakeholders are watching. Your challenge is to build and unleash the power of your team to exponentially multiply your own commitment to business growth.

Marty Zwilling

*** First published on Inc.com on 07/15/2019 ***

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Sunday, July 28, 2019

7 Keys To Balancing Profits Versus A Higher Purpose

people-planet-profitIt’s always been tough to start a new business, even when the bottom line was just making a profit to stay alive. A few years ago, a second focus of sustainability (“green”) was added as a requirement for respectability. Now I almost always hear a third mandate - social responsibility. Entrepreneurs are now measured against the “triple bottom line” (TBL or 3BL) of people, planet, and profit.

The real challenge with the triple bottom line is that these three separate accounts cannot be easily added up. It’s difficult to measure the planet and people accounts in any quantifiable terms, compared to profits. How does any entrepreneur define the right balance, and then measure their performance against real metrics?

Lots of people are trying to help, with new twists on the age-old model of free-market capitalism that has driven businesses for the last 500 years. Current examples include Conscious Capitalism®, popularized by John Mackey, The B Team, founded by Sir Richard Branson, the 1% for the Planet organization, and the Benefit Corporation (B Corp) now available in 35 States.

In the interest of helping first-time entrepreneurs, as well as existing business executives, keep their sanity as well as their focus, I offer the following pragmatic suggestions for dealing with the triple bottom line requirements:

  1. Sort out your personal definition of success first. Starting and running any business is hard work, so the last thing you need is “success” with no satisfaction. If your primary dream is to help the starving people around the world, or prevent global warming, you might consider a nonprofit, academic, on government role, rather be an entrepreneur.
  1. Making a profit does not imply greed. Many young entrepreneurs seem to think that capitalism and making profit are dirty words. The reality is that you can’t help people or the environment, or yourself, if you don’t have any money. Businesses run by ethical people create value and prosperity based on voluntary exchange, while reducing poverty.

  1. Sustainability and social responsibility alone don’t make a viable business. As an angel investor, I see too many business proposals that are heavy on sustainability, but light on financial realities. Most customers today won’t pay you five times the cost of alternatives, just because yours is “green.”

  1. The whole can be greater than the sum of the parts. The real opportunity for entrepreneurs is to provide solutions that solve a problem better than the competition, while also providing sustainability and social responsibility. Conscious Capitalism companies, for example, historically have outperformed the S&P 500 index by a factor of ten.

  1. Responsibility and integrity are still the key. A responsible entrepreneur promotes both loyalty and responsible consumption by educating consumers so they can make more informed decisions about their purchases, based on ecological footprints, and other sustainability criteria. That’s a win-win business for the customer and the entrepreneur.

  1. Explore new forms of company ownership and profit sharing. There is no rule in capitalism that employees and other stakeholders can’t equitably share in the returns. In fact, there is plenty of evidence that these arrangements, such as with Whole Foods, are easy to implement, and pay big productivity, loyalty, as well as financial dividends.
  1. Begin tracking your positive social and environmental impacts. What you measure is what you get, because what you measure is what you are likely to pay attention to. Tracking can be informal, or you can follow a more formal system, like Global Impact Investing Ratings System (GIIRS). Even informal results can be your best advertising.

It’s a lot more productive and a lot less risky to start early in building your record of the positives on social, environmental, and people responsibility, rather than wait and hope never to be caught in an excessive profits scandal, child labor issue, or poor sustainability practice.

So while the bar for business success continues to go up, because we all now operate on a world stage, the entrepreneur “best practices” haven’t changed. Every entrepreneur needs to start with a strong vision, think long-term, communicate effectively, and always lead with responsibility and integrity. The days of success measured only by monetary returns are over. How does your business stack up against the triple bottom line?

Marty Zwilling

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Saturday, July 27, 2019

10 Techniques For Enhancing Your Personal Trust Level

business-trust-levelOne of the first harsh realities that every entrepreneur has to learn is that most of the things that are critical to startup success are outside of their direct control. Just because you dream it and build it, doesn’t mean they will come – that encompasses not only customers, but also investors, partners, team members, and even your own family. They won’t come if they don’t trust you.

In my experience, trust is the most powerful tool that an entrepreneur can wield, both inside and outside of his own realm of control. I’ve seen many examples of this in my own business life, and yet I gained a whole new perspective on how it works from a classic book by successful entrepreneur August Turak, titled “Business Secrets of the Trappist Monks.”

Turak first visited the monks for spiritual guidance, but realized as he talked to them about their business, that many of their secrets crossed over all boundaries. I was particularly struck by the lessons he gleaned on how to get and maintain trust. The best entrepreneurs I know seem to have learned every one of these, so start on these now if you want to survive among the best:

  1. Become trustworthy before you start a business. We are hard wired to seek out trustworthy people, and to test others to see who we can trust. But the first step is to be become trustworthy ourselves. Like attracts like, and if you invest early in becoming a person others can trust, business people who you can trust will be attracted to you.
  1. Keep your promises to yourself and others. The surest mark of a trustworthy person is one who keeps promises to others and to oneself, no matter how small or seemingly trivial these may be. Keeping promises to yourself is closely correlated with will power and self-control, and these virtues are essential to being business trustworthy.
  1. Under commit and over deliver. Make sure that you only make business commitments that you know you can keep. Many entrepreneurs over-commit because they are desperate to have business constituents like and respect them, yet the quickest way to lose respect is to fail to keep commitments.
  1. Be willing to make commitments. One of the stratagems of notoriously unreliable people is refusing to make promises in the first place, thinking that making no commitments relieves them of any worry about breaking them. People see through this strategy quickly, and will tag you not reliable and indecisive, as well as not trustworthy.
  1. Protect your personal brand. As a new startup, you the entrepreneur are the brand. Get in the habit of asking yourself, “How will this decision affect my personal brand?” Everything you do or don’t do affects your brand, and in the long run your trustworthiness is your most valuable asset.
  1. Avoid fuzzy commitments. Nothing undermines trust faster than ambiguity or soft commitments, through phrases like “I’ll try” or “I’ll do my best.” These are heard as attempts to stay off the hook, and furnish plausible deniability for anticipated failure. Don’t be afraid to write down what you expect, and what you are willing to commit to.
  1. Formalize business promise keeping. This simply means making it standard practice in your new startup of building a paper trail of contracts (no verbal contracts) between partners and vendors, customer transactions, and internal processes with team performance metrics.
  1. Never make people ask. If you make people hound you about a commitment, you have already lost half of your credibility. Nothing builds trust better than anticipating your obligations and delivering on them without being asked. A debt repaid before it is asked for reaps a huge dividend in trust.
  1. Communicate, communicate, communicate. No one can anticipate all risks and keep all their promises, but there is no excuse for a failure to communicate when contingencies arise, so there are no surprises. Lack of communication leads others to assume that you had no intention of keeping your promise, and were hoping no one would notice.
  1. Aim past the target. It is impossible to be trustworthy in business if you are unreliable in the other aspects of your life. The monks teach that trust is not a business strategy or tactic; it is the natural by-product of living for a higher purpose. If you have no higher purpose as an entrepreneur than to make money, you will most likely fail in your efforts.

In business, as in your personal life, an entrepreneur must offer his own trust before reasonably hoping to have it reciprocated. Don’t try to “game the system,” and don’t expect blind faith to save you. The power of real trust is that if your constituents trust that you can change the world, you probably will. Isn’t that why you signed up for this lifestyle in the first place?

Marty Zwilling

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Friday, July 26, 2019

10 Elements of a Coaching Culture and Why You Need It

coach-culture-businessEvery entrepreneur and business person I know wishes he had more time for coaching all the members of his team. I often hear the excuse that coaching takes more time than simply diving in and doing the job for the other person, but is that really true? In fact, studies have shown that the long-term value of coaching has a return of at least 2x to more than 100x times the cost.

Of course, that assumes that you or someone you trust knows how to do it right, has the right attitude, and has the trust of the person who needs the coaching. These things don’t happen automatically, and require you as a business leader to build a company culture of coaching at all levels from the very beginning. The key elements of this culture should include the following:

  1. Be the role model for providing coaching and assistance. If you don’t take the time to provide coaching to people, versus issuing orders, you will never establish a coaching culture, no mature what your policies state. Every successful entrepreneur needs to spend more time developing people, as the business grows. Expect it and plan for it.

  2. Exceptional communication is a prerequisite to coaching. A business with a coaching culture needs to start with well-defined and documented roadmap, and leaders who are able to communicate these goals clearly and often. Coaches must also be able to give direct feedback regularly, reinforce key messages, and acknowledge success.

  3. Reward team members who take the time and effort to share. These are your natural coaches, as well as your best performers. They need to know that helping is appreciated and beneficial to their career and performance feedback. Effective rewards include public recognition for their efforts, special development assignments, as well as compensation.

  4. Seek out people who are not afraid to confront issues. People who seek to avoid all conflict or never disagree, do not make good coaches. You need healthy conflict to get people to face their limitations, and to fully understand customer and operational issues. That’s why I recommend that you as a leader always seek opposing views of reality.

  5. Look for evidence of a willingness to learn and change. Great coaches typically have a continuing need to learn, from self-development courses, reading, and getting coaching themselves from people in areas unfamiliar to them. They will inspire team members to look outside the box and try new things for the development of their own potential.

  6. Focus on team members that are the emotionally mature. There is no place in coaching for emotional outbursts and petty biases. Good coaches are able to easily build sustainable relationships with others, both at work and outside. They need to possess uncommon empathy and compassion for others, in order to really help them.

  7. A coaching culture thrives on agility and resilience. Both good coaches and good businesses are strong enough to change course quickly as the needs change and the market changes. People need coaching to weather setbacks and surprises which can dilute their confidence, and take away their ability to experience their full potential.

  8. Good coaches prepare for each session and follow up. Coaching is not casual conversation, or for off-the-cuff comments. Coaching sessions should be scheduled in advance, and the coach should be organized for each session to address specific topics. Be prepared with information, examples, feedback, and ready for discussion.

  9. Find people who actively listen before responding to input. You can’t coach someone if you don’t understand their point of view, and you can’t get that point of view without listening first. People who pre-plan their response are prone to miscommunication or misunderstanding. A coaching culture requires real dialogue rather than pontification.

  10. Only hire and partner with people who have a positive outlook. Experience levels for a role in a resume don’t tell you everything. Use your interviews to find people who are perpetually optimistic, thereby coachable, as you can be certain that roles will change over time. Negativity is really coaching in the wrong direction, and you don’t need that.

People often ask me about the difference between coaching and mentoring. I see these as two different disciplines - a business mentor helps to fill an experience gap, while a business coach helps fill a skill gap. Both may be required, but a coaching culture is required for either to work.

A mentor’s aim is to teach you by using specific examples of what to do and how, unlike a coach who helps you develop your generic skills for deciding what to do and when. Neither is about job titles, or what your expertise is, but is more about who you are.

Thus a coaching culture is well worth the investment in time and effort. In fact, in today’s digital age, with a rapid movement to new generations of workers, and equally rapid changes in technology and market demands, your business may not survive without it.

Marty Zwilling

*** First published on CayenneConsulting on 07/11/2019 ***

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Wednesday, July 24, 2019

4 Laws Of Natural Selection Relate To Every Business

survival-of-the-fittestThe good news is that the latest Kauffman Early-Stage Entrepreneurship (KESE) Index shows the highest level of new business activity recorded in the last two decades, and the cost of entry at an all-time low. The bad news is that it’s still a jungle fight for survival for entrepreneurs of all ages and demographics, with over 80 percent not having access to bank loans or venture capital.

In this context, it’s time for every business, not only startups, to take a fresh look at the basics of business success. Jamie Gerdsen, in his classic book of lessons on business change, creatively titled “Squirrels, Boats, and Thoroughbreds,” aims first at existing businesses, but I believe that most of his points, like his laws of the jungle, can be rewritten for startups, as follows:

  1. If you want to eat... I don’t believe in greed, but we all need to make enough money to eat. This means building a revenue stream, and tuning your business model to produce margins in the 50 percent range or above. I support being socially and environmentally conscious, but you can’t help anyone else if you don’t eat.
  1. If you want to survive... Survival means growth and scaling. Once you have a proven business model, you need to scale the business up quickly to stay ahead of competitors. These days, doubling your business volumes every year is the “norm” that investors and potential acquirers are looking for.
  1. If you want to be feared... Every startup needs a sustainable competitive advantage. In the jungle, it might be the strongest jaws, but in startups it’s more likely the strongest intellectual property. With no competitive advantage, startups with new ideas gaining traction are never feared, and are usually eaten for lunch as sleeping giants wake up.
  1. If you want to mate... In the business world, we call this finding the right strategic alliances. That means you have to stand out above the crowd, and aggressively pursue those candidates that can help you breed even more presence and power in the marketplace. Sitting quietly on the sidelines, waiting to be found, is a lonely world.

Every startup in the business jungle begins with a limited amount of three precious commodities – time, talent, and treasures. The smart ones have a plan for how they intend to spend these resources, and measure themselves against the plan. Otherwise they will likely look back later, and find that one or more of the laws of the jungle have been compromised:

  • Time – Start with a timeline of how much runway you have, with objectives and milestones mapped against the timeline. Time management is an art. Don’t waste precious time on the “crisis of the day,” in favor of strategically critical tasks. The best entrepreneurs work on making better time management a top objective.

  • Talent – Every startup needs talents to give the company value. In the beginning, the entrepreneur has to cover all talents, which is made more possible these days by the wealth of information available on the Internet, as well as books and online courses. Talent can also be outsourced, but surviving in the business jungle without talent is unlikely.

  • Treasure – Most entrepreneurs assume that treasure means funding. In reality, more important treasures often include intellectual property, the ability to innovate, and well-defined processes that can deliver great products and reach new customers more efficiently and effectively than competitors. Money is no substitute for these other treasures.

In summary, whether you are running a startup, a family business, or a famous brand like IBM, you are all part of the jungle. You can be a small tiger with big teeth, or an aging dinosaur. The laws of the jungle apply to all. It really is a world of survival for the fittest.

The jungle framework is a great one to set the right perspective. Startups which prosper and succeed learn the rules of the jungle early, don’t make excuses, and don’t look for any entitlements. Does your startup have an understanding of reality, a real sense of urgency, and the overwhelming drive to innovation to make you the king of the jungle any time soon?

Marty Zwilling

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Monday, July 22, 2019

9 Ways to Use Pull Marketing When Push Doesn’t Work

Push-pull-marketingMore and more customers these days are doing their own marketing research, scanning internet reviews and feedback from friends, rather than trusting messages that you push out through advertising. This is called inbound marketing, where customers are pulled to you, rather than feeling accosted at every turn by your brand messages via email, newspapers and television.

Inbound marketing is all building two-way virtual relationships, which are the norm for today’s generation via social media, mobile apps, recommendations from “friends” and influencers, modern websites with customer-focused content, friendly forums, and chat bots. If you have yet to get started, here are some key steps that I recommend to my advisory business clients:

  1. Actively engage customers via top social media sites. Recently I was surprised to find that up to 25 percent of businesses still don’t use social media at all, and many more only monitor it, but rarely engage. I recommend that you experiment to find the best sites for your business, with the majors including Twitter, Facebook, Instagram and YouTube.

  2. Update your website to make it totally customer-focused. A quick scan of the Internet today will convince you that many sites are still product-centric, technology focused, and haven’t been updated for years. Today people want to see customer needs highlighted, mobile friendly, recommendations from prior customers, and interactive help channels.

  3. Provide mobile device apps and interactive support. As American customers with smartphones now exceed 80 percent, and adults spending more time on mobile than watching TV, the advantages of mobile device support continue to increase. Inbound marketing requires that you be where your customers are, or they won’t find you or care.

  4. Highlight and practice a commitment to a higher purpose. Customers are pulled to companies that are role models for saving the environment, fostering social change, and giving back to the less advantaged. For example, Whole Foods pulls in customers by highlighting their efforts to sustain the environment and ensure humane animal treatment.

  5. Become a thought leader and influencer in your domain. Be creative and add value to what you offer your target audience, without calling it marketing. Adding value builds influence and subsequently can build your business, as well as your Klout score. Customers love to learn from leaders and innovators, and this pulls them in for sales.

  6. Provide memorable total customer experience relationships. Customers are pulled in by differentiators that go well beyond the product, including ease of shopping, ordering, delivery, customer reviews, and personalization. Your overall customer experience will trump product features every time, in terms of loyalty, trust, and return visits.

  7. Establish partnerships with recognized pull businesses. Pursue collaborations with local and national organizations and businesses who are good at inbound marketing, to pull in their customers and followers. Develop and learn from shared marketing efforts, trade-show booths, co-branding promotional products, and referral agreements.

  8. Implement marketing metrics based on inbound data. Inbound marketing data, including site page visits, blog reads, inbound links, and e-commerce orders linked to content are much more relatable to return-on-investment (ROI) than email blasts, banner-ad views, and TV show ratings. Take advantage of new automated tools in this area.

  9. Consistently deliver updated and valuable content. Companies that haven’t updated their website for years, or publish a new blog only sporadically, won’t be followed or pull in new customers. The key is consistency. In this context, content is like advertising, unless customers want to see you every day, they won’t remember anything about you.

In fact, I believe that inbound or pull marketing is just the first of several waves of change in the world of digital marketing, where customers are in charge. Customers now feel immune to most marketing influences, except the ones they initiate. Your challenge is to deliver your message in the context of customer value, and build relationships, without anyone feeling a push.

Marty Zwilling

*** First published on Inc.com on 07/08/2019 ***

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Sunday, July 21, 2019

7 Myths And Reality On Employees Thinking Like Owners

Employees-thinking-like-ownersEvery startup lucky enough to get some traction gets to the point where they decide to hire some “regular employees” for sales, marketing, and administrative tasks. Then they are surprised to see productivity and creativity take a big dip. What they should be doing is hiring only “entrepreneurs,” meaning people who think and act as if this is their own business.

This commitment to hire people who think like entrepreneurs, or instill an “owner’s mindset” in every employee, should be a high priority in every business. It’s what every customer looks for in every transaction. Most people will tell you this is impossible, but I found a classic book, “Army of Entrepreneurs,” by Jennifer Prosek, where she seems to have actually accomplished this.

I like how she was able to motivate, train, and reward employees, including the implementation of an incentive program to get every member of the team actively involved in generating new business. She also identifies the typical myths against using this approach, and describes how to overcome each one:

  1. “Entrepreneurs are born, not made.” The reality is that all entrepreneurial skills are learnable skills. The entrepreneurial mindset is a function of motivation, priorities, and risk versus reward, all of which you set or enable by your leadership and example. Hire employees who have strong skills, with the motivation to learn new ones.
  1. “Employees will care only about work they create.” This is really an issue of the quality of the people you hire rather than the management or compensation system. The key is to hire people with the right mindset, and communicate it daily to your whole team, by your actions as well as your words.
  1. “Junior people shouldn’t be involved in new business.” This is the platitude of an obsolete corporate culture where you had to “pay your dues” in menial jobs before adding creativity or making decisions. In today’s marketplace, junior staffers are often the most intimately connected to the market, technology, and the customer network.
  1. “Employees will lose focus on their work.” Old management models encourage employees to optimize their own task, often at the expense of the overall company objectives. There is new evidence that people want to understand the bigger picture, and business growth financial incentives will increase productivity, rather than lower it.
  1. “Sales will be the organization’s sole focus.” Again, you get what you demand and reward. If sales are the only way to get rewarded in your organization, then sales will take precedence over other activities. Motivate for a spectrum of entrepreneurial behaviors, and you will see results.
  1. “We don’t need to reward lead generation.” For a startup, you don’t have a recognized brand to bring in the leads. All businesses need to proactively seek leads, rather than simply attract them, with the creativity and initiatives of every employee rewarded for every contribution.
  1. “There is too much risk associated with decentralized decision making.” When you have to move and change quickly to survive, centralized decision making is too slow. You become the bottleneck. If you train people properly, empower them, trust them, and they understand the business, your evolving business can become a revolution.

Every large company wishes they could harness the power of a thousand entrepreneurs within their employee ranks to re-create the exceptional business growth they once knew. Instead, for growth, most have resigned themselves to buying startups that exhibit these characteristics.

Thus, the last thing you need as a growing startup is a “regular employee.” Hire entrepreneurs like you, grow like an entrepreneurial company, and stand above competitors in the acquisition process to carry that fire forward. That’s a win-win for everyone in this new culture and new economy.

Marty Zwilling

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Saturday, July 20, 2019

8 Self-Check Questions That Keep Leaders Up At Night

Leader-awake-at-nightEven entrepreneurs who have built many startups, or sold their last one for millions of dollars, know they make occasional people leadership mistakes. They know leadership is all about managing their own complicated, illogical, and fallible human foibles, as well as the people they depend on. These can trip up even the best, often at the cost of more than a good night’s sleep.

Thankfully, most mistakes won’t be as spectacular as the America Online merger with Time Warner for $350 billion, back in 2000, engineered by then superstar entrepreneurs Stephen M. Case and Gerald M. Levin. They apparently ignored all conventional wisdom and advisors, and struck a deal which crashed both companies, now a case study in many business schools.

By most accounts, this case exhibits almost all the lapses identified in a classic book by Dr. Nicole Lipkin, “What Keeps Leaders Up At Night.” She provides some great guidance, based on coaching experience and a doctorate in clinical psychology, on recognizing and resolving the most troubling management issues for leaders in all stages of an organization:

  1. I’m a good leader. So why do I sometimes act like a bad one? According to the evidence, good bosses go bad (temporarily versus the chronically horrible), for three overarching reasons – too busy to win, to proud to see, or too afraid to lose. Every leader needs to check and enhance his self-awareness to recognize and avoid these.
  1. Why don’t people heed my sage advice? Many people use the terms influence, persuasion, and manipulation interchangeably. But each carries its own specific meaning. Influence requires winning minds and hearts to inspire action. Persuasion intellectually stimulates a person to action. Manipulation is seen as insincerity, and it gets non-action.
  1. Why do I lose my cool in hot situations? Stress comes in two distinct forms: good stress and bad stress (distress). Managed effectively, stress is a good thing, leading to survival. But chronic stress and distress results in overreaction to non-life-threatening events. Schedule an on-going reality check with trusted advisors to know the difference.
  1. Why does a good fight sometimes go bad? A good fight in business is called healthy competition. Unfortunately, feelings of envy and inferiority can quickly turn healthy competition into a knock-down, drag-out fight between people and companies, turning a win-win situation into a lose-lose one. Check all your emotions at the gate.
  1. Why can ambition sabotage success? Every leader needs to balance ambition with humility, restrain one’s ego, treat others with respect, create positive impressions, and adopt a long-term perspective of success. Don’t let a “nearsighted” view cloud the “big-picture” view; success in the best interests of all. Contemplate your legacy to others.
  1. Why do people resist change? The brain’s hard wiring pre-disposes us to habitual behavior and decision making. We let biases influence our reaction to change and our ability to make decisions that cause change. To thrive you need to become more aware of biases and psychology behind your own and your people’s responses to change.
  1. Why do good teams go bad? Humans have always affiliated with groups and teams in order to survive and thrive. Group dynamics are not always good, including “us” versus “them” mentality, group conformity, social loafing, and emotional contagion. Leaders need to manage these dynamics to keep from falling prey to negative group behaviors.
  1. What causes a star to fade? When start performers fade, it’s almost always a failure to remain engaged with the people and the job. Smart leaders must constantly monitor the four essential elements of engagement: social connection, leadership excellence, aligned culture, and meaningful work and life. Engagement drives performance and satisfaction.

These questions should all be contemplated and understood by every entrepreneur and startup founder, starting on day one of their quest. Remember, we are all human, and we will make mistakes. The challenge is to learn from these, and just as importantly, learn from others who have been there before you.

So when you find yourself losing sleep at night, don’t get mired in the quicksand of self-pity and self-destruction. Every personal admonition of “What was I thinking?” should be followed with some objective analysis, maybe some help from a trusted ally, and a determination to get back on track and have fun. Being an entrepreneur is a lifestyle you must enjoy to be successful.

Marty Zwilling

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Friday, July 19, 2019

What the 5 Stages of Grief Teach Us About Technology

Kübler_Ross's_stages_of_griefHow many times have investors heard startups start their pitch by touting that their technology is “disruptive?” What entrepreneurs forget or don’t realize is that most customers are wary of all technology, educating the market on new technology is expensive, takes a long time, and people buy problem solutions rather than technology. Investors will likely wait for more traction.

The concept of disruptive technology was first introduced by Clayton M. Christensen in “The Innovator’s Dilemma” way back in 1995. Such technologies, like the digital camera and mobile phones, introduce such novel concepts that they displace existing technology quickly by societal standards. Unfortunately this “quickly” may be too slowly to save initial startups in the space.

In this time of rapid change, it’s easy to conclude that everyone is an early adopter, and we all tend to forget quickly the time and stages we go through while adapting to new technologies, and then loving them. It’s time to review the classic article on HBR “The Five Stages of Disruption Denial,” by Grant McCracken, comparing technology adoption to Kubler-Ross’ five stages of grief:

  1. Confusion. We don't quite get it. We sign up for the new app, or buy one of the new devices after we see our cool friends using it. We give it a whirl, and quickly complain that things were easier the old way. By this time, gurus are reassuring us that it is the greatest thing ever. But that doesn't help. We decide to wait another year for the next version.
  1. Repudiation. There are many people who don't get the new technology, and now social life is a little like a competition to show that we're not "falling for it." At this point, there can more social capital in saying that we don't like the technology than that we do. We all hear snappy one-liners like, "Twitter. What could I possibly say in 140 characters?"
  1. Shaming. This is when we are so persuaded that we're right and the new innovation is wrong that we are prepared to make fun of the credulous among us. "This Twitter thing. It's just a fad. Give it a couple of months and it will go away." We heard a lot of this sort of thing about Pinterest in the early days. Now it's valued at $13 billion.
  1. Acceptance. By this time, the innovation is taking off. The middle adopters are signing on. It is clear now even to late adopters (the great majority) that there is at least one useful aspect of the new technology, and it’s here to stay. Confronted by accomplished, irrefutable fact, the rest of us cave in, sign up, and brag about how modern we are.
  1. Forgetting. This is where we destroy the evidence, even in our own mind. Now we are inclined to act as if we always understood and approved of a world instilled with new innovation. One minute, we are too smart to be fooled by Twitter. The next we are fully on board. It's a like high school. We are captives of what Mark Earls calls "the herd."

In the old days, it typically took 20 years for this process to happen. Now it happens much faster, but it still takes longer that the survival lifetime of a struggling startup. Smartphone acceptance in the USA is now over 80 percent, only twelve years after the first Apple iPhone was introduced. There is other evidence that may be the new norm, and will be soon beaten.

Marketing guru Seth Godin mentioned in an article a while back that “it takes about six years of hard work to become an overnight success.” Mark Zuckerberg spent about 7 years and $150 million before Facebook became cash-flow positive. MySpace and several others, who arguably pioneered the disruptive social media technology, never really survived to enjoy it.

Too many of the entrepreneurs I know who highlighted their disruptive technology early ultimately ran out of money and had to shut down for being “ahead of their time.” They did everything right, but the market just wasn't ready. Sometimes this is just an excuse for other problems, but don’t forget the old investor saying: "being early is the same as being wrong."

Overall, I think more startups do fail by being too early to market than fail by being too late. This is probably a hard message to swallow, but it’s usually the second mouse that gets the cheese. What are you doing to avoid this trap with your disruptive technology?

Marty Zwilling

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Wednesday, July 17, 2019

Use Key Strategic Elements To Avoid Business Plateaus

Business-growth-plateauOne of the biggest challenges I find for new business owners is for them to move from working in the business to working on the business. You are so engaged in building and selling your product or service, that you “don’t have time” to focus on strategy and the next round of changes for the business to survive and grow. The result is a business plateau that hits you like a ton of bricks.

As a business advisor, when I bring this up, at best I will hear the defense that you are focused on the strategy of the moment, such as such as how to increase sales, or reach a new market. I have to admit that I have struggled with this myself many times, trying to understand all the dimensions of strategy, which has always seemed like an amorphous and overwhelming subject.

I was happy to see some good guidance on this subject in a new book, “Outsizing: Strategies to Grow Your Business, Profits, and Potential,” by Steve Coughran, who is a thought leader and consultant in this area. He outlines six dimensions of a winning business strategy, with some practical, research-based steps that I like, to focus on in achieving extraordinary results:

  1. Above all, deliver an exceptional total customer experience. The most successful companies today build a strategy to proactively anticipate the needs of their customers, as a group and individually, and totally delight them with all aspects of the shopping experience, value, delivery, and help with any follow-on questions or problems.

    For example, Apple has been a master at this, developing products like the iPod and iPhone before customers even knew they needed them, creating Apple stores with a whole new shopping and support experience, and intuitive usage needing no manuals.

  2. Highlight your competitive value, not your technology. This may sound obvious, but I still see too many companies with a strategy of highlighting technology improvements and features, rather than their value compared to competitors. This requires constant study of what your customers value, what competitors offer, and your target market.

    Converting customer-centric advantages into business value requires a deep understanding of all the financial elements of your business, as well as customer drivers. It starts with continually optimizing your business model, using analytics on all the data, and creating and using metrics to measure your performance and progress to date.

  3. Seek out and capitalize on emerging opportunities. We all wish we could “see around corners,” and are envious of people like Steve Jobs and Elon Musk, who seem to have this ability. With a little hard work at projecting market and technology turns, as well as the courage to make bold decisions, any of us can move further in this direction.

    For example, it doesn’t take a genius to see opportunities today due to the massive changes in healthcare, environmental concerns, social changes around the world, and the new generations of consumers. But it does take effort to weave these into a strategy.

  4. Unleash the potential of your team and talent. Strong leaders continually work on a strategy of hiring, developing, and retaining the best and the brightest. Too many business owners I know push these efforts to the bottom of their priority list, in favor of the operational crisis of the moment, or until they feel gaping holes in their team.

    Most successful CEOs now recognize motivated teams and a strong culture as one of the greatest sources of competitive advantage and long-term growth. A strategy of empowering people will produce near-term as well as lasting results for your business.

  5. Turn value creation (revenue) into value capture (profit). Strategy is more than hashing out mission, vision, and value statements. It’s making sure that these statements are financially grounded with specifics to assure an adequate return on investment for all constituents. Focus on user counts, or revenue alone, won’t make a long-term business.

    Smart growth and value capture strategies usually include selling more to existing customers and your current market, and selling current products in a new market. before developing new products or carving out a new and untested space for your business.

  6. Internalize the strategy process keyed to the bottom line. Strategy can’t be a one-time effort. Customers and the market don’t stand still, so your strategy can’t either. Efficiency is achieved through consistency and innovation, based on the bottom line results of your business. Establish a strategic cycle of initiatives, actions, and results.

With each of these dimensions, you can see that strategy is actually about working on the business, as well as in it. It’s hard work, and requires that you learn from your mistakes. Yet I’m convinced that we are operating at an exciting time, standing on the edge of new and exciting opportunities. Success won’t come from a random walk – build a strategy now for your future.

Marty Zwilling

*** First published on Inc.com on 07/03/2019 ***

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Monday, July 15, 2019

10 Ways Your Startup Co-Founder Is Like A Good Spouse

Sergey-Brin-Larry-Page-Eric-SchmidtAs a long-time business advisor and angel investor, I’m a believer that “two heads are better than one” in building a new business. Very few entrepreneurs have the range of skills and experience to be the solution creator as well as business creator, or operational as well as sales leader. The challenge is to recognize and recruit that ideal partner match early with minimal cost and risk.

In fact, I would broaden the definition of partner from co-founder to “business partner.” The reason is that good attributes apply equally well to “external” partners, as they do to internal partners, like a co-founder or CTO. A good overall example is the synergy between Google co-founders Sergey Brin and Larry Page, as well as long-time Executive Chairman Eric Schmidt.

In all cases, the challenge is the same, of finding people that you can work with and enjoy in the business relationship. The relationship has to have trust, communication, and respect in order to work. Otherwise, like a marriage, it will be doomed to constant conflict, second guessing, and unhappiness. So the following traits have to apply to both sides of the partnership to work:

  1. Capable of working collaboratively. Some people are too independent to be partner material. If they or you find it hard to trust others, love to work alone, always have to be in control, or insist on micro-managing, it may be time for change or looking elsewhere.
  1. Neither partner needs to be managed. Good partners are people who are confident in their own abilities, and willing and able to make decisions, take responsibility for their actions, and able to provide leadership, rather than require leadership.
  1. All partners have compatible work styles. Most entrepreneurs work long hours and weekends to get the job done. If you team with a partner who likes to sleep late, and reserves the weekend for other activities, the partnership will likely not work.
  1. Agree on a common vision and commitment. It doesn’t take long to sense someone’s real commitment, or vision and desired outcome of a joint project. Is your project seen by both as an end in itself, or a means to another end? Conflicting visions won’t work.
  1. Believe in similar values and goals. If one of your core values is exceeding your customer expectations for quality and service, and your potential partner ascribes to the low cost, high profit mantra, a successful partnership is highly unlikely over the long-term.
  1. Operate with a comparable level of integrity. High levels of integrity are important in business, but more important is your level of comfort with your partner’s integrity. This is a critical element of a good relationship, but a tough one. This is probably the best place to apply your “gut” feeling.
  1. Brings complementary skills and experience. If both of you are experts at software development, even though one loves design and the other loves coding, that still won’t get the marketing done. Look at the big picture first of development, finance, and marketing/sales.
  1. Feels a real passion and love for their role. The passion has to be in the business context – meaning results oriented, customer oriented, and sensitive to competition. In many cases, experts with academic or research credentials are not good partners for a business venture.
  1. Believe in the same ethical and diversity boundaries. How the leaders of your company handle adherence to the spirit as well as the letter of the law will be seen by all employees, customers, and investors. Ethics and the view of personal boundaries should be explored fully.
  1. Carry minimal historical baggage. Partner decisions are more important than team member hiring decisions. Thus you should do the same or more due diligence on educational background, previous work, and references. Look impartially from all angles and do the follow-up on all relevant previous roles.

Beyond the core team of two or three startup partners, every startup should seek to “outsource” the rest of their strategic requirements to external business partners. It’s faster and cheaper than building a large team in-house, and usually more effective.

By using this checklist, you should be able to objectively match potential partners with your own needs and expectations. Then, as I always recommend, it’s time to establish a formal agreement or contract to cement the partnership. With that, you will have a strong foundation for success, as well as a great working relationship for the next thirty years.

Marty Zwilling

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Sunday, July 14, 2019

10 Innovation Myths For New Venture Founders To Avoid

innovation-mythsMost people think innovation is all about ideas, when in fact it is more about delivery, people, and process. Entrepreneurs looking to innovate need to understand the execution challenge if they expect their startup to carve out a profitable niche in the marketplace, and keep innovating to build and maintain a sustainable competitive advantage.

Everyone thinks they know how to make their innovation into reality, but I can’t find much deep research on the subject. At the same time, myths about innovation are commonplace in business. Vijay Govindarajan and Chris Trimble, in their classic book “The Other Side of Innovation: Solving the Execution Challenge” have done some good work on the execution side.

They take you step-by-step through the innovation execution process, in the context the ten most common myths about innovation, which I think makes their approach particularly instructive:

  1. Innovation is all about ideas. While it is true that you can’t get started without an idea, the importance of the Big Hunt is vastly overrated. Ideas are only beginnings. Without the necessary focus, discipline, and resources on execution, nothing happens.
  1. A great leader never fails at innovation. When it comes to innovation, there is nothing simple about execution. The inherent conflicts between innovation and ongoing operations are simply too fundamental and too powerful for one person to tackle alone.
  1. Effective innovation leaders are subversives fighting the system. Effective innovation leaders are not necessarily the biggest risk takers, mavericks, and rebels. The primary virtue of an effective innovation leader is humility. What you want is integration with real world operations, not an undisciplined and chaotic mess.
  1. Everyone can be an innovator. Ideation is everyone’s job, as are small improvements in each employee’s direct sphere of responsibility. Yet most team members don’t have the bandwidth or interest to do their existing job, and well as address major innovations.
  1. Real innovation happens bottoms-up. Innovation initiatives of any appreciable scale require a formal, intentional resource commitment. That requires the focus and resources from top executives to sustain, even initiate, relevant efforts.
  1. Innovation can be embedded inside an established organization. Some forms of innovation can be imbedded, like continuous product improvement, but discontinuous innovation is basically incompatible with ongoing operations.
  1. Initiating innovation requires wholesale organizational change. Innovation requires only targeted change. The first principle is to do no harm to existing operations. A common approach that works is to use dedicated teams to structure innovative efforts.
  1. Innovation can only happen in skunk works. Innovation should not be isolated from ongoing operations. There must be engagement between the two. Nearly every worthwhile innovation initiative needs to leverage existing assets and capabilities.
  1. Innovation is unmanageable chaos. Unfortunately, best practices for generating ideas have almost nothing to do with best practices for moving them forward. Innovation must be closely and carefully managed, during the 99% of the journey that is execution.
  1. Only startups can innovate. Luckily for entrepreneurs, many large companies are convinced that they must leave innovation to startups. Yet research suggests that many of the world’s biggest problems can only be solved by large, established corporations.

Everyone agrees that the goal of innovation is positive change, to make someone or something better. Entrepreneurs need it to start, and established companies need it to survive. The front end of innovation, or “ideating” is the energizing and glamorous part. Execution seems like behind-the-scenes dirty work.

But without the reality of execution, innovative ideas really have no value. Customers are interested in solutions, and investors want to see the money. Your real challenge as an entrepreneur is to create an innovative business, not an innovative idea.

Marty Zwilling

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Saturday, July 13, 2019

9 Elements Of Every New Venture That Investors Expect

Business-model-canvas-prepNew entrepreneurs are always looking for a shortcut in getting their venture story and plan across to investors, and closing on the funding they need. An effective tool I see used more and more, as a prelude to a more detailed business plan, is the Business Model Canvas, first introduced by Alexander Osterwalder back in 2008. It forces you to bridge the gap between idea and execution.

The canvas is a visual chart with elements describing your value proposition, structure, finances, and customers, to help companies identify and align business activities. Now I see in an excellent book, “Business Models for Teams,” by Tim Clark and Bruce Hazen, an extension of this process to down inside the venture, for teams and individuals. It shows you how everyone works in synergy.

In my experience as a new business advisor, a business is nothing until people are aligned and work in sync. As an active angel investor, I look for this level of alignment and understanding in every funding presentation I hear. I look for evidence of the nine major elements of the model canvas, as paraphrased here from the author’s key points and how they apply to teams:

  1. Customer segments. A business without well-defined customers is never fundable. Valid customer segments must be quantified for every opportunity. Many businesses these days serve both paying and non-paying customers, such as Google and Facebook, who count on millions of non-paying users to attract advertisers, who really pay the bill.
  1. Value propositions. Think of value propositions as bundles of services or products that create benefits (value) for customers. The ability to deliver better value is the main reason why customers select one competitor over another. Value should always include not only functions, but also social, environmental, and emotional benefits as well.
  1. Revenue. Every business needs revenue to provide investor returns and offset costs. “Free” is not an attractive revenue model to investors. Popular revenue models today include recurring subscription charges, licensing, as well the traditional sale or lease model. Every team needs to understand how their activities relate to customer revenue.
  1. Costs. Every entrepreneur needs to know and communicate the total costs associated with their solution or product, including cost of goods sold, customer acquisition costs, capital costs, operational expenses, and partner costs. Every team and every individual should know their own cost contributions required to complete their activities.
  1. Key resources. Investors are looking for the sum of all assets that are truly essential for creating, communicating, selling, and delivering your value proposition. These normally include people, tangible property, intellectual property, and cash flow requirements. Secondary assets, such as desks and computers, can be ignored at the funding stage.
  1. Channels. Channels have to be identified through which a startup creates awareness, induces evaluation, enables purchase, and executes the delivery of the value proposition. Every team and every individual needs to know how they relate to, or are responsible for, specific customer relationships. Investors will demand clear channel definitions.
  1. Customer relationships. Today, businesses are all about customer relationships, not just transactions. Thus investors expect to hear about strategies and technologies that your company plans to use to manage all customer interactions, with the goals of attracting new customers, improving customer retention, and driving sales growth.
  1. Key activities. These are the important things the business must do to make a specific business model work, specifically creating, communicating, selling, and delivering value propositions. Then there is the follow-up to provide customer support and satisfaction. Entrepreneurs who can’t communicate specific activities are not ready for funding.
  1. Key partners. No startup or entrepreneur is an island. It takes partners to make a business work, normally including suppliers, marketing, channel, and distribution partners, as well as funding partners. Every partner has their own set of activities and required resources. Every startup looking for investment needs a solid partner story.

Beyond the investment, a major challenge that every entrepreneur faces is getting teams and every individual on the team aligned and committed to the overall strategy and plan. That step, commonly called the we-to-me translation, is another value of the business model canvas and its extensions. There are no shortcuts to funding, but it pays to use the tools that work. Try this one.

Marty Zwilling

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Friday, July 12, 2019

7 Wise Leadership Strategies When Smart is Not Enough

Bill-Gates-wise-lookMost of the entrepreneurs I have met are smart, but many are not always wise. That means they may show great insights into a new technology that has marginal business value, their passion may motivate team members more than customers, or they may allow themselves to be pulled over the ethical line in their success drive. Wise leaders are authentic, timeless, and enduring.

Of course, experience is the ultimate teacher of the differences between smart and wise. But none of us can afford to make that many mistakes, so it helps to understand the basic principles that are key to making wise, as well as smart, decisions. In their classic book on the subject, “From Smart to Wise,” Prasad Kaipa and Navi Radjou offer some great observations, based on their years of research and consulting experience with hundreds of leaders.

I’ve summarized their basic principles here, in the context of early-stage entrepreneurs and startups, in the hope of providing a head start, and fewer mistakes to recover from, for every entrepreneur:

  1. Broaden your perspective for your passion, to the greater good. Perspective is what defines us, and shapes our thoughts and actions. For technologists it drives the passion to take new ideas to new realities. Wise leaders tend to connect their worldview and ideas, to help everyone find a larger meaning in life. Steve Jobs espoused this principle.
  1. Act authentically and appropriately as your perspective changes. Wise entrepreneurs are sensitive to the context they operate in and fine-tune their actions accordingly, while continuing to serve their higher purpose. They never forget their moral compass, and maintain credibility by always bridging the saying-versus-doing gap.
  1. Learn to perform any role well, without forgetting who you really are. We all know a smart entrepreneur who wouldn’t give up the CEO role, and lost the company. Wise leaders give up an existing role when it is time. They willingly act as trustees or servant leaders in whatever actions and roles they accept. Bill Gates seems to fit this model.
  1. Expand horizons to make every decision win-win versus win-lose. Smart leaders tend to make decisions instinctively, based on their own experience, with little attention to the larger context. Wise decisions win in the long run for the broader purpose, as well as problem at hand. Don’t let practical execution or emotions sway strategic deliberations.
  1. Know when to hold and when to fold, with flexible fortitude. Many smart leaders tend to stick with a decision, without any re-alignment to a rapidly changing external context. Wise leaders show courage in following the context, and grace in letting go when appropriate. This flexible fortitude keeps them aligned with the long-term benefit.
  1. Act and lead with enlightened self-interest, to serve others. This world is now too complex for one entrepreneur to have all the resources and products needed to satisfy their customers. That means nurturing partnerships and cooperation with competition, for the greater good. It’s a move from pure self-interest to enlightened self-interest.
  1. Strive to create your own authentic path to wise leadership. First adopt the six leadership elements including perspective, action orientation, role clarity, decision logic, fortitude, and motivation. Then integrate these in your own path to wise leadership, building wise cross-functional teams, wise organizations, and wise communities.

Smart people impress us all with their intellectual power and uncanny ability to achieve their goals. But smartness alone is not always sufficient to keep entrepreneurs out of trouble and sustain their success. Wise entrepreneurs ultimately are the ones that create lasting value for both stakeholders and society.

Evolving from smart to wise requires nothing more than reflecting on the best practices of other wise entrepreneurs and emulating them appropriately in your own personal journey and roles. Now is the time to measure where you are along the path, and build the roadmap for your journey. Have you assessed your leadership style lately against these principles?

Marty Zwilling

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Wednesday, July 10, 2019

8 Ways To Learn From Your Team And Succeed Together

succeed-with-your-teamStarting and running a company is a team effort. Yes, it takes a leader (entrepreneur), but you can’t do it alone, without a team. Maybe only you and a co-founder comprise the team at first, to provide key skills, back you up, and test your ideas. As the startup grows, the team has to be able to really push you in making growth decisions, rather than you pulling them along.

The responsibility for leadership rests on you as the founder or CEO, and your leadership style. Many entrepreneurs still fall back to the traditional “control” leadership paradigm, but I don’t see it working so well any more. I agree more with Dr. Roger Schwarz and his classic book, “Smart Leaders, Smarter Teams.” He outlines eight keys to an effective mutual learning approach as follows:

  1. State views and ask genuine questions. When you state your views and ask genuine questions, you are convincingly open and curious. Understand that curiosity doesn’t mean agreement, and all questions are not genuine. Recognize that rhetorical questions seek to make a point or make people do something, not come up with a real answer.
  1. Share all relevant information. All team members need all the right information, before they can make, understand, and implement forward-looking decisions. That means sharing timely information that doesn’t always support your view, or might upset others. You should disclose your feelings, and any limiting factors like privacy or legality.
  1. Use specific examples and agree on what important words mean. If you hear someone on the team using a word or term that you think is unclear to others, ask for a specific example. This usually requires naming real names, rather than “someone,” and asking what you really want to know, without generalizing the question.
  1. Explain reasoning and intent. Teams are hardwired to make meaning out of problems. When you share your reasoning and intent, you reduce the need for others to figure out reasons, or assume something is being withheld. Start every meeting with one or two sentences that explain what you want to talk about and why.
  1. Focus on interests, not positions. Positions represent specific solutions from a given team member, whereas interests are the underlying needs that drive people to their position. You need a decision that meets all key interests, in order to get total commitment to the best solution from the team.
  1. Test assumptions and inferences. Assumptions are conclusions with no information. Inferences are conclusions about things you don’t know based on things you do know. Avoid assumptions, and test every inference by checking it against behavior confirmed by someone else. Untested inferences are among the main reasons a team gets stuck.
  1. Jointly design next steps. When you jointly design next steps, you design them with others instead of for others. It increases the chance that you will get a genuinely workable solution and that the team will be committed to implementing it. Keep in mind that joint design doesn’t mean that you give up your prerogative of making the final decision..
  1. Discuss un-discussable issues. These are topics relevant to a solution that team members won’t address in the team, due to fear or compassion. Examples include disruptive actions of a team member or a boss. Leaders may start the discussion outside, but must address it, with respect, inside the team for mutual learning and resolution.

Where you as the leader may be part of the problem in the mutual learning process, it may be necessary to ask a third party inside the organization, or a consultant from outside the organization to facilitate the transformation, or the resolution of a tough change issue. True leaders know how to move out of the way to let others do what they do best.

The results are improved performance, stronger working relationships, and greater well-being for you, your team, and your company. In the long run, every entrepreneur needs to remember that it’s the team, with their broader range of skills and experience, that builds the leader’s success – and not the other way around. This rarely happens with total control leadership.

Marty Zwilling

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Monday, July 8, 2019

10 Challenging Insights From New Venture Innovators

Insights-from-entrepreneursMost people agree that entrepreneurs have to think differently and take risks to have much chance of building a successful business. Yet I have found that serious entrepreneurs usually go way beyond these platitudes in their actions and thinking, and often won’t volunteer their real views, for fear of alienating “regular” people, and being branded a fanatic.

In the classic book “The Entrepreneur Mind,” from serial entrepreneur Kevin D. Johnson, he outlines 100 essential beliefs, insights, and habits of serious entrepreneurs. Most of these are predictable, like think big and create new markets, but I found a few, like the ten below, that will likely raise the hackles of many people outside this lifestyle, and many “wannabe” entrepreneurs.

Yet, based on my own years of experience “in the business”, mentoring many entrepreneurs, and following stalwarts like Elon Musk and Jeff Bezos, even these potentially controversial mindsets ring true to me:

  1. All risk isn’t risky. Entrepreneurs surely understand the high probability of failure, but they don’t necessarily like to gamble. Instead, they take calculated risks, stacking the deck in their favor. They must have enough confidence in themselves, supplemented by expert knowledge, solid relationships, or personal wealth, to see the risk as near zero.
  1. Business comes first, family second. This view isn’t a selfish one, but a recognition by serious entrepreneurs that family well-being is dependent on the success of the business, not the other way around. This is why airlines ask you to put on your oxygen mask first. Should you forego closing a million dollar deal to attend a ball game with your son?
  1. Following your passion is bogus. Look for a good business model first. Your passion may be for a good cause, like curing world hunger, but it may not be a good business. In any young business, you inevitably find things that are not enjoyable, but need to be done, like cold calls or firing unproductive employees. Just doing fun things is a myth.
  1. It’s not about being your own boss. Great entrepreneurs aren’t interested in being bosses at all. People who crave the freedom to do what they want when they want generally make terrible entrepreneurs. In order to be a successful entrepreneur, discipline is a must, and accept your new bosses as investors, partners, and customers.

  1. Fire your worst customers. We have all had customers who take advantage of us, to the detriment of other good customers. The best entrepreneurs are quick to make the tough decisions to bypass bad customers, with proper respect, to minimize frustration, resource drain, and reputation loss. You can’t please everyone all the time.
  1. Ignorance can be bliss. It’s great to be highly familiar with the industry in which you plan to compete, but many times people see too many challenges, and never start. In other cases, entrepreneurs are opening up new business areas, so no one yet knows the challenges. Serious entrepreneurs trust their ability to beat a new path to the opportunity.
  1. You’re in no rush to get an MBA. If you are already an entrepreneur, more education, including an MBA, will only slow you down. Consider it a waste of time. If you plan to become an entrepreneur, and already have business experience or an undergraduate business degree, skip the two-year delay and cost of the MBA.
  1. You are odd, and it’s OK. Entrepreneurs, especially those in technology, usually don’t start out as well-rounded, well-adjusted leaders. In fact, being odd is quite the norm. According to other studies, attention-deficit disorder (ADD) is common, as well as host of other personality disorders. It’s actually cool to be a geek in this lifestyle.
  1. A check in hand means nothing. Every entrepreneur remembers their naïve days when that first customer check bounced. When you receive a new purchase order, a check, a verbal agreement, or even a written agreement, don’t get too happy and excited. Save the celebration until you have cold cash in hand, or the funds are verified.
  1. There’s no such thing as a cold call. If you are an elite entrepreneur, you don’t go into anything cold. With the Internet and a plethora of other resources, you can warm up any call quickly, and not waste your time or theirs. Doing your homework first is one of the best ways to get an advantage over your competition.

If you think Johnson is on the right track, see his book for 90 more challenging insights. Even if you disagree with some of these, try to open your mind to the value of the seemingly backward way of thinking required to be a great entrepreneur – others seek refuge, they take risks; others want a job, they want to create jobs; others follow the market, while they define the market.

Have you caught the entrepreneur bug yet? If so, prepare for a lifetime commitment, and learn from the elite. There is no turning back.

Marty Zwilling

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Sunday, July 7, 2019

6 Keys To Growing Your Career Through The Gig Economy

Gig-economy-careerWhile everyone agrees that the “gig economy” is really here, the practical realities, other than not counting on long-term employment, are not so obvious. In my role as a mentor to many business professionals, I still see some who have no idea how to adapt to the new realities. The simple answer is that we all have to start thinking like entrepreneurs, rather than entitled employees.

To me, that means treating your career more like a business than a job – with a continual and global focus on keeping up with competition, finding customers, preparing for changes ahead, and taking responsibility for your own finances. With entrepreneurial thinking, this can be a win-win, with you getting more control, and good for companies, who want the more flexible staffing.

On the other hand, if you expect your employer to push you into future training required, always have a growth opportunity waiting, and set all your work parameters, then you may find a difficult road ahead. My recommendation is that you must start today preparing yourself for the future, by thinking of your current employer as a customer, and focusing on the following specifics:

  1. Quantify your value to your employer, compared to alternatives. I’m not looking for a personal guess, but some real homework done via networking and the Internet to see what other companies pay for the same role. Then look ahead to assess the likelihood that your job could be eliminated with new technology, artificial intelligence, or robots.

    This may seem scary, but it’s the reality, and what every entrepreneur has to do at every stage of survival and success. The good news is that this exercise, if done well, will be the best evidence to support your next raise request, as well as showing your readiness for the new gig economy.

  2. Assess your intellectual capital and how to increase it. It’s time to take a hard look at your breadth of experience, relevant relationships, connections, and skill depth, compared to your peers in that role. More intellectual capital means that you are worth more today in the marketplace.

    Take advantage of any and all current opportunities, such as industry conferences and special projects, to increase your intellectual capital for current roles and gigs in the future. Entrepreneurial thinking is all about being proactive, rather than wait to be pushed.

  3. Start tracking your costs as well as income elements. Most employees I know have no idea what their business life costs, since they have never had to worry about costs as employees. These costs include travel, training, supplies, office space, bookkeeping, and many others. You need to understand your real income requirements to survive on gigs.

    You will find it pays big dividends, even in your personal life, to track and manage expenses with a simple business platform, like QuickBooks or Apptivo, for work and family. With one of these, the step into the gig economy will be much less painful.

  4. Build your reputation and visibility beyond your company. Every employee or entrepreneur needs to build a competitive reputation on the Internet, through a website, blog, LinkedIn profile, and social media. Don’t let Facebook party pictures be the only way people see you when looking for a professional. Market your business expertise.

    In today’s gig economy, your professional reputation, references, and your ability to market yourself are the keys to success. All of these can be built and will serve you well while still an employee, looking for your next promotion or your first gig.

  5. Explore small gig opportunities without quitting your day job. Just as I recommend that aspiring entrepreneurs get their startup going before leaving a regular job, you should start competing for small gigs that can be done in the evenings or on weekends, to test your fit and needs, before you get forced into this world full time.

    In the current vernacular, these are often called “side hustles.” They make sense if you just want to pad your savings by creating additional income sources, as well as for testing the waters for your ability to thrive in the solo entrepreneur world of the gig economy.

  6. Regularly scan the marketplace for potential anchor clients. Before you get pushed out into the gig economy, you need to be looking for a few key clients that would likely select you and give you recurring business. There are already multiple gig platforms, including UpWork and TaskRabbit, that you can freely explore through the Internet.

You may think that gigs are relevant only to the low end of the skill spectrum, such as data entry and social media monitoring, but I see more and more highly qualified marketing and development people choosing the gig route rather than long-term employment for higher returns and more challenging work. Don’t wait for your next company layoff to get you started.

Marty Zwilling

*** First published on Inc.com on 06/21/2019 ***

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Saturday, July 6, 2019

How To Ensure Results From All Business Conversations

Connection-Business-CollaborationWhether 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 classic 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.
  1. 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.
  1. 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.
  1. 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.
  1. 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.
  1. 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.
  1. 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.
  1. 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.
  1. 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.
  1. 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.
  1. 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.
  1. 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 extends 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

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