Trends come and go. In its Innovation special Business Week takes a look at leading trends in the business community. Last year was all about execution, but that was then… (While you’re there be sure to check out the Special Reports.)
This year’s emphasis on strategic thinking suggests that, like an individual recovering from a personal upheaval, businesses today are taking stock: reviewing their options, rethinking their strategies, considering new opportunities and innovations.
Another trend is the questioning of CEO compensation, once strictly the province of the board of directors and a few consultants, today it’s everyman’s topic of conversation. Do you think today’s CEO compensation, not just on Wall Street, but in general, is fair and appropriate? Do the incentives work? Do they focus too much on risk taking or do they encourage excessive caution? Read this interview for some excellent insights.
Speaking of fortunes, what do the elder statesmen of Wall Street, guys like George Soros, Nicholas F. Brady, John S. Reed, William H. Donaldson and John C. Bogle have in common with you and me? Surprise, surprise, they all believe that Wall Street needs to be reigned in.
They grew quite wealthy in finance, typically making their fortunes in the ’70s and ’80s when banks and securities firms were considerably more regulated. And now, parting company with the current chieftains, they want more rules.
Another rich guy is John Thain, a trend of his own. Fired from his CEO aerie he has landed on his golden feet at CIT. The man who didn’t see anything wrong with spending $1.2 million renovating his office in 2008 is now responsible for the company that provides financing for SMB, as well as being the third-largest railcar-leasing and aircraft-financing firm in the U.S. In his hands rests much of our future—at least he’s not planning to redecorate.
“This is a company that’s over 100 years old and its core business is lending to small- and medium-sized companies,” Thain said yesterday in an interview. “If we’re going to get the U.S. economy to continue to grow, if we’re going to create jobs, then we need to have this kind of a company do well.”
Our final trend comes from Forbes, famous for the way it slices and dices lists of wealthy people. Its newest look offers yet another one—billionaires under age 40.
Of the current eight, four are from China, three are from the U.S. and one is from Japan.
Crucial questions for startups and small businesses, since how they are addressed can make or break the company.
Often the most important hires made when a company wants to grow are in sales.
Founders and owners often have technical, marketing or business backgrounds and many have a tendency to shrug when it comes to sales.
They see hiring salespeople as no big deal—there is an assumption that as long as they have a good track record in their previous sales position and understand the new product they can manage themselves.
If this sounds off base to you, you’re right, it’s not that simple. To use a real-life example, I had a client who thought that way.
The CEO hired “Jack” (before my time), a salesman with a fantastic record selling a parallel product to the same market.
The CEO personally taught Jack the product line and explained what the company was working to accomplish and then pretty much gave him free reign.
In the year Jack was with them he sold only two accounts, spent a good deal of his time on marketing and managed one large client; commissions totaled only $15K.
When he left he went to work in a field completely unrelated to anything he’d done before and in a market about which he knew nothing. In his first year at the new company he earned over 125K in commissions.
The difference was management.
Based on his track record both the CEO and Jack assumed that he could manage himself.
However, Jack didn’t have, and didn’t create for himself, the structure, accountability, etc., necessary to be successful.
During his exit interview he admitted that although he had no knowledge or training in marketing, he spent substantially more time than he should have because it was new and exciting.
After the CEO and I had fully analyzed what happened he concluded that the failure was 80-20, with the 80% his responsibility.
Hind sight is 20/20 and my client believes that if he had taken the time to do what was needed, instead of expecting Jack to completely manage himself, that he would still be with the company and doing a spectacular job.
The important lesson here is that “self-starter” does not mean “self-managed.” Even the best will need direction, structure, and accountability in order to perform brilliantly.
Ask any employee at any level what motivates them the most
easy work
low performance standards
no consequences
or
challenging work
higher achievement
accountability
and 9 out of 10 will choose the second list.
So why do school boards do the opposite?
Many school districts follow the lead of the Dallas Independent School District, which follows the first list with slavish devotion.
What happens when the second list is followed instead?
One program is called early-college high school and it mixes college level courses with the normal courses taught in junior and senior years and is offered to at-risk kids, not the over-achieving elite.
“Last year, half our early-college high schools had zero dropouts, and that’s just unprecedented for North Carolina, where only 62 percent of our high school students graduate after four years,” said Tony Habit, president of the North Carolina New Schools Project, the nonprofit group spearheading the state’s high school reform.
In addition, North Carolina’s early-college high school students are getting slightly better grades in their college courses than their older classmates.
Started in 1994 as an experiment with 50 fifth graders in Houston’s inner city, KIPP has blossomed into the biggest U.S. charter school operator, with 82 schools for poor and minority children in 19 states.
KIPP now has an 85% college matriculation rate, compared with 40% for low-income students nationwide, according to a 2008 report card KIPP prepared and posted on its Web site. About 90% of KIPP’s 20,000 students are black or Hispanic; 80% qualify for subsidized meals.
The difference between the two lists can be summed up in one work—expectations.
The foundation of expectations is a belief that whatever it is can be accomplished.
We humans tend to strive to meet the expectations of those around us, be they bosses, friends, parents, teachers or school administrators.
Actions more than words tell us what is expected.
List 1 = low expectations and kids live up to them.
List 2 = high expectations and the kids live up to them.
An angry email berated me for Saturday’s post, saying in part, “Why don’t you ever choose more typical CEOs and cultures to write about? I read blogs to help me manage more effectively and the stuff you talk about is almost impossible to implement.”
The answer, in a nutshell, is that you can’t implement anything at odds with your own MAP (mindset, attitude, philosophy™)
Therefore:
If you don’t believe in a happy workplace where people have fun then there is nothing that Tony Hsieh or anybody else can teach you that will help you create one.
If you stand on your dignity and can’t laugh at yourself there is no way you can implement The Levity Effect.
I could keep giving examples, but you get the point.
I, and dozens of other experts, have said over and over that people can’t sell something they don’t believe themselves.
Nor can they implement cultural features that are out of sync with their MAP.
This is especially true for managers because they typically hire in their own image, so that their team has similar MAP—and the same problem.
If you find yourself on this treadmill, rather than write an angry email or complain to your buddies look in the mirror and know that you can change if you want to.
Saturday I recommended spending some of your valuable time on TED, so I thought I’d offer a sample of it that I really liked.
Derek Sivers received a standing ovation for his 3 minute talk on leadership using the video below.
Too often people over focus on the moving pictures, so be sure to pay full attention to what Sivers is saying in conjunction with what is happening in the video.
Because the words are so important you can read a transcript at Siver’s site (along with other good stuff). I hope you take a moment to do so.
I’m not backing down on my contention that leadership is for all, but I completely agree that everyone can’t be leaders simultaneously and that following is just as important, if not more so.
Leadership is over-glorified.
Yes it started with the shirtless guy, and he’ll get all the credit, but you saw what really happened:
It was the first follower that transformed a lone nut into a leader.
There is no movement without the first follower.
We’re told we all need to be leaders, but that would be really ineffective.
The best way to make a movement, if you really care, is to courageously follow and show others how to follow.
When you find a lone nut doing something great, have the guts to be the first person to stand up and join in.
Today is Valentine Day and I sincerely hope that you have better things planned than reading blogs—even mine.
Do you believe in love at first sight? I think that if one is going to be honest the looks exchanged by strangers across a crowded room are more likely to be lust, than love at first glance.
Thousands of years ago Buddha said, “Of all the worldly passions, lust is the most intense. All other worldly passions seem to follow in its train;” whereas Elizabeth Hurley puts a far more modern spin on it, “A bit of lusting after someone does wonders for you and is good for your skin.”
Lust can rest in one’s mind and never be acted upon, but, if action is preferred, it is wise to first ponder the words of John Barrymore, “Sex: the thing that takes up the least amount of time and causes the most amount of trouble.”
If that doesn’t dampen desire, then—man or woman—heed Shakespeare’s warning in Macbeth: “Alcohol provokes the desire, but it takes away the performance.”
The thing about lust and sex is that they are both short-lived, although a lot of fun while they’re happening.
But, as Joanne Woodward points out, “Sexiness wears thin after a while and beauty fades, but to be married to a man who makes you laugh every day, ah, now that’s a real treat.”
And that brings us to love—about which millions of words have been spoken, not to mention written.
Love is quirky and difficult to define, but Roy Croft offers a bit of wisdom that makes a great deal of sense, “I love you not because of who you are, but because of who I am when I am with you.”
Anon has a bit of wisdom to offer up that would improve life on all levels is we would just follow it, “Laugh as much as you breathe and love as long as you live.”
But what of intimacy?
Barbara Cartland, who certainly knows all about these topics (do you think she does her own research?) says, “Among men, sex sometimes results in intimacy; among women, intimacy sometimes results in sex.”
However, true as that is, it is Thomas More who really understands the road to real intimacy, “Romantic love is an illusion. Most of us discover this truth at the end of a love affair or else when the sweet emotions of love lead us into marriage and then turn down their flames.”
Have a wonderful day. Spread love lavishly throughout your world and it will come back to you as a tsunami.
I’m not sure whether it’s amusing or ironic (or both) but breakout companies all seem to be focused on culture. And when they are successful, no matter the business, they are immediately in high demand to tell others how they do it—think Tony Hsieh and Zappos.
Last Saturday I told you about Nick Sarillo, whose two pizza restaurants in Chicago do $7 million a year with 20% turnover vs. the casual dining industry average of 200%. As a result of the Inc magazine profile he is keynote speaker at the Pizza Executive Summit this summer. I’m sure he’ll be in demand other places. I love the title—“Culture 2.0: Branding your company’s way of life;” think about it.
Along with being a culture fanatic I also believe that anyone can lead given the opportunity, challenge and a supportive culture in which the messenger is never killed.
An NYT interview with Mark Pincus, founder and chief executive of Zynga offers insight into his approach of making all his people CEOs.
“I’d turn people into C.E.O.’s. One thing I did at my second company was to put white sticky sheets on the wall, and I put everyone’s name on one of the sheets, and I said, “By the end of the week, everybody needs to write what you’re C.E.O. of, and it needs to be something really meaningful.” And that way, everyone knows whose C.E.O. of what and they know whom to ask instead of me. And it was really effective. People liked it. And there was nowhere to hide.”
Stories from CEOs of their most life-changing day in their careers. Sometimes the result was promotion to the upper reaches of business, and sometimes a steep fall from grace.
TED has become a phenomenon and it’s on now. Plan to spend some time listening to an eclectic group of creative thinkers.
TED is a small nonprofit devoted to Ideas Worth Spreading. It started out (in 1984) as a conference bringing together people from three worlds: Technology, Entertainment, Design.
The annual conferences in Long Beach and Oxford bring together the world’s most fascinating thinkers and doers, who are challenged to give the talk of their lives (in 18 minutes).
In a final tip of the hat to Valentine’s Day tomorrow, check out substitutes for Viagra that taste great.
“What’s more important to you, being right or winning?”
That is what I asked a caller today.
“Frank” has been sequestered on jury duty for several weeks and when he returned to work he found that right after he left his team was assigned a new project and they were just finishing.
Frank said that the project had gone well, was on time and in budget, but he was upset that they had used a different approach from the one he preferred.
That’s when I asked, “What’s more important to you, being right or winning?”
You’d think that was an easy answer, but I was met first with silence and then with multiple reasons proving his approach was better.
He agreed that on time/in budget was a win, but still felt they should have done it his way.
So I ask you, “What’s more important, being right or winning?”
Entrepreneurs face difficulties that are hard for most people to imagine, let alone understand. You can find anonymous help and connections that do understand at 7 cups of tea.
Crises never end.
$10 really does make a difference and you’ll never miss it,
How flat should an organization be?
So why do school boards do the opposite?
An angry email berated me for 
Today is Valentine Day and I sincerely hope that you have better things planned than reading blogs—even mine.
“What’s more important to you, being right or winning?”
