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Archive for March, 2015

Ducks in a Row: Amazon’s Non-Compete Paranoia

Tuesday, March 31st, 2015

https://www.flickr.com/photos/tambako/6968045836Non-compete agreements are the bane of workers, especially those whose skills are industry-specific and don’t travel well — such as semiconductors — and whose employers answer to state laws other than California’s.

And it’s easy to understand employer paranoia regarding proprietary information, trade secrets, customer lists, etc.

Intel’s legendary Andy Grove built its culture on the idea that “only the paranoid survive,” but Jeff Bezos’ paranoia makes Grove look like Mister Mellow.
That paranoia really shows up in the 18 month non-compete clause for hourly and seasonal workers.

“[Workers can not] engage in or support the development, manufacture, marketing, or sale of any product or service that competes or is intended to compete with any product or service sold, offered, or otherwise provided by Amazon (or intended to be sold, offered, or otherwise provided by Amazon in the future) that employee worked on or supported, or about which employee obtained or received confidential information”

Even more bizarre is the definition of “competitors,” which include physical retailers, publishers, e-commerce retailers, media companies, payment processing and information/computing storage.

Granted, it’s never been enforced and the company says they are removing it, but it certainly gives a window on Bezos’ paranoia.

And while it could be the product of an unconstrained law department, but given Bezos’ well-known micro-focus that’s doubtful .

Image credit: Tambako The Jaguar

Survival and Inspiration

Monday, March 30th, 2015

Stories of human survival don’t seem to affect me as much as those of plants and animals. Perhaps it’s because, in general, I prefer them to people.

Whatever the reason, the story of the Tree That Will Not Be Broken resonated deep within me.

It was the last living thing rescued from the ruins of 9/11. A dozen years later, one mythical pear tree is finally home, and branching out from Ground Zero in mystical ways.

Perhaps it’s because I have a Japanese maple that everybody told me was dead; get rid of it; put in something new to enjoy — but I didn’t.

I left the tree alone for a couple of years, pruned the parts that didn’t grow in that time and since then it has flourished.

Amazing what time and patience can do for the severely damaged.

Sadly, both are in short supply these days — although the damaged are not.

Image credit: Narratively

Entrepreneurs: the Weight of Your Words

Thursday, March 26th, 2015


“I sometimes say things — just stupid, little remarks — and expect people to just ignore them. They will not. They will not. Every little thing you say is something that will stick in people’s heads.” –Amazon CTO Werner Vogels 

Livefyre CEO Jordan Kretchmer, said that he’s made a “benign comment that pissed off the whole sales team.”

Chief product officer of Interaxon, Trevor Coleman, said that once at a happy hour he joked about taking the company in a completely new direction. The following day, an employee asked him — quite seriously — what the next steps for that change would be.

LinkedIn CEO Jeff Weiner said that every offhand comment he made would turn into a “massively disruptive fire drill…”

There is no such thing as a benign or casual comment, throwaway thought or product/strategy-related joke when you are a senior manager.

This is nothing new. I wrote about the same thing in 2006 and the event I described happened 20 years before that.

The question isn’t how to mitigate the damage; the real question is how do we change the thinking that fosters it in every new generation of leaders.

Image credit: Ben Beltran

Employee Retention: Not Rocket Science

Wednesday, March 25th, 2015


Yesterday we looked at how a new IBM analytics tool that analyzes tweets found that customer loyalty was severely impacted by employee turnover.

A decade ago research by Frederick Reichheld found that a 5% improvement in employee retention translated to a 25%-100% gain in earnings.

Deloitte recently released its annual survey, which seems to back up the need for improved retention.

2015 Global Human Capital Trends report, their annual comprehensive study of HR, leadership, and talent challenges, the top ten talent challenges reported for 2015 are: culture and engagement, leadership, learning and development, reinventing HR, workforce on demand, performance management, HR and people analytics, simplification of work, machines as talent, and people data everywhere.

The first three are nothing new; the terms have changed over the years, although not the meaning behind them or their ranking as top concerns.

In a major employee retention push, companies are turning to algorithms and analytics to mine a raft of data, identify which employees are most likely to leave and then try to change their minds.

But some things never seem to change and until they do companies won’t make much headway.

At Credit Suisse, managers’ performance and team size turn out to be surprisingly powerful influences (emphasis added –ed.), with a spike in attrition among employees working on large teams with low-rated managers.

With decades of research saying the same thing, it makes one wonder why the finding was “surprising.”

In fact, nothing will change until companies, bosses and the media stop being surprised every time a survey shows that talent acquisition and retention is most influenced by

  • the culture in which they work;
  • the bosses for whom they work;
  • the work itself; and
  • the difference they can make.

Gee, maybe it really is rocket science.

Image credit: Steve Jurvetson

Ducks in a Row: Proof That Employee Turnover Hurts Customer Retention

Tuesday, March 24th, 2015


Back in October Twitter and IBM announced a new service to give enterprise a way to mine its 15 billion daily tweets.

Of the research done since the, one result surprised them.

The more a customer shops at a particular store or eats at a particular restaurant, the more likely they are to stop shopping there when employees leave. It stands to reason that you would get to know the people at a place you patronize often, but IBM found that really loyal customers get so attached to employees that they complain on Twitter about having to “start over” if a favorite employee leaves. If they don’t feel like employees know them, this can really impact revenue because the loyal customers are the ones who spend the most money.

Do you find that surprising? I don’t, having done the same thing myself. (I’ve also switched brands when a favorite was acquired by a company I didn’t trust.)

Cost of customer acquisition is the most critical, prime metric when valuing any business, from startup through Fortune 50.

For the last few decades the prime focus has been on investors, while customers came in a long second; IBM’s findings move customers much closer to investors.

Why employee turnover results in customer defections isn’t the least surprising.

It’s a well accepted dictum that people don’t leave companies, they leave managers — or leave because of management turnover, so customers leaving for a similar reason makes sense.

However, employees are still a long third behind investors and customers.

When I started writing this blog back in 2006 I cited research by Frederick Reichheld that proved a 5% improvement in employee retention translated to a 25%-100% gain in earnings.

You would think that a 25% earnings increase, let alone higher, would be enough to get the attention of even the greediest Wall Street types, but obviously not, since low employee turnover is still cause for amazement.

Perhaps the new Twitter/IBM findings will help drive the needed change.

Image credit: BetterWorks Breakroom

Influence, Persuasion and Manipulation

Monday, March 23rd, 2015


Last week I had lunch with four managers, “Larry,” “Mandy,” “Paul” and “Ashish.” At one point the conversation turned to how the ability to influence people affected the ability to lead.

It was a lively conversation, but I stayed on the sidelines; noticing my silence, Ashish asked me what I thought.

Instead of responding I asked all of them what the difference was between influence, persuasion and manipulation.

This provoked another active discussion, with the upshot that while it was acceptable to influence people it was wrong to manipulate them. This time it was Mandy who asked what I thought.

I responded that I didn’t see a lot of difference between the three.

That shocked them all, but really upset Larry.

So I explained my thinking, which formed the basis of this post in 2011.

Influence = Manipulation

Every conversation about leadership talks about ‘influence’ and how to increase yours.

In a post at Forbes, Howard Scharlatt defines influence this way,

Influence is, simply put, the power and ability to personally affect others’ actions, decisions, opinions or thinking. At one level, it is about compliance, about getting someone to go along with what you want them to do.

He goes on to describe three kinds of influencing tactics: logical, emotional and cooperative, or influencing with head, heart and hands and talks about ‘personal influence’ and its importance in persuading people when authority is lacking.

A couple of years ago I wrote The Power of Words and said, “Personally, other than socially acceptable definitions, I don’t see a lot of difference between influence and manipulation,” and I still don’t.

I realize most people consider manipulation negative and influence positive, but they are just words.

I often hear that leaders are good people, while manipulators are bad people. But as I pointed out in another post,

  • leaders are not by definition “good;”
  • they aren’t always positive role models; and
  • one person’s “good” leader is another person’s demon.

Everyone believes they use their influence in a positive way, but when you persuade people to do [whatever] who are you to say that both the short and long-term outcome is positive for them?

Influence, persuasion, manipulation; call it what you will, just remember that it is power and be cautious when you wield it.

In spite of the heated disagreement I saw no reason to change my thinking.

I was surprised at the end of the discussion when even Larry commented that while it made sense that the words didn’t actually signal intent he still didn’t like it and wasn’t about to use them interchangeably, which made sense to me, because language carries the meaning (and the baggage) of the time and place in which it’s used.

Image credit: Anne Adrian

If the Shoe Fits: the Cost of Distraction

Friday, March 20th, 2015

A Friday series exploring Startups and the people who make them go. Read all If the Shoe Fits posts here

5726760809_bf0bf0f558_mWhat happens when you create a fast growing business that has unicorn potential, but it doesn’t fit with your personal dream?

Do you pursue both?

That’s what Ben Nash did and almost destroyed PCS Wireless in the process.

Nash had always dreamed of being a real-estate mogul, while PCS Wireless bought, fixed and sold old cell phones.

Glamorous real estate or mundane phone reselling — which would you chase?

“I was running around the business world trying to find myself. I got distracted with ego and shiny things. I lost money in real estate, but losing money isn’t the problem. That’s a minor issue. I’ve always personally made money. The issue was my energy and focus was going to my other businesses and not to PCS.”

Nash didn’t get himself back on track, his team did.

About two years ago, the PCS executive team sat Nash down and gave him the “are we going to do this or not?” talk. (It’s “very important to surround yourself with people who are smarter than you,” is how Nash describes his team.)

There are myriad distractions in life; everybody has them.

What’s important isn’t the distraction, but how you deal with it.

And how comfortable your team would be if it was necessary to sit you down for “the talk.”

Image credit: HikingArtist

Entrepreneur: 2 Thoughts for Spring

Thursday, March 19th, 2015

Today is the first day of Spring; happy news for all of us.

I’m going to work in my garden, which is getting active—especially the weeds.

So I thought I’d provide some food for thought in the form of two images that need absolutely no further commentary from me.

best teacher-last mistakenot wealthy-cant buy























Have a wonderful day; I plan to!!


Managed by Q: No 1099

Wednesday, March 18th, 2015


I’m not a lover of the so-called 1099 economy, primarily because I think the concept and the unicorns it’s spawned have been successful at gaming the system — so far.

But that’s unlikely to last.

More importantly, a company called Managed by Q is proving it doesn’t need to.

Managed by Q provides on-demand cleaning services for offices using an iPad, which it installs for free, and also offers other services like restocking the fridge or office supplies. With on-demand and subscription services for customers — and now 150 cleaners in New York — its services have become pretty popular: They’re used by other startups like Flatiron Health, Elite Daily, and Uber.

Managed by Q hires its “operators,” as it calls them, as employees, offering full-time and part-time employment with benefits and stock options. The work is flexible, and Managed by Q works with operators’ schedules.

I find it ironic that Uber, poster child of the 1099 model, hires a company that proves you can make money and still do traditional hiring, treat all employees well, draw investment and make money.

I’ve said it before and will continue saying it because it’s true, a company is like a three legged stool with investors, customers and employees being the legs. If one leg is longer or more robust than another the stool will tip over.

Managed by Q is part of the minority of on-demand services that is paying attention not just to its clients, but to the people carrying out its day-to-day work. And that’s what sets it apart.

Sets it apart, gives people a future, isn’t looking at lawsuits and seems to have missed the startup greed train.

All I can say is read the article and three cheers for Q, the anti-1099 heroes.

Image credit: Yelp

Hydrate Yourself with Plant Nanny

Monday, March 16th, 2015

plant-nannyLast year I wrote two posts on the value of sleep and how to power nap, important to all, but especially to entrepreneurs.

Without good sleep your life will be ruined, but if you don’t drink enough water your life will end, period. (Note: it’s not a comfortable ending.)

People know this, it’s not rocket science.

But knowing isn’t doing.

So as a public service today I’m sharing an article about Plant Nanny; a whimsical way to make sure you stay hydrated.

When you download the app, you input some personal information (height, weight, physical activity level) and then pick out a plant. Plant Nanny tells you how many cups of water you have to drink per day.

For every cup of water you drink, you tap the little circle in the bottom right hand corner. The goal is to drink all the cups of water you’re supposed to every day. It keeps your plant happy, and presumably it keeps you hydrated. If you forget to water your plant, it will look sad. If you completely neglect it, it will die and you’ll have to start over.

I like the fact that the amount of water, as well as the size of your “cup,” is customizable based on you — not one-size-fits-all, which it doesn’t.

It works on iPhone and Android, so you don’t have that excuse.

Besides being a lot healthier, water is a whole lot cheaper — as in free.

If you have a thing against tap water, invest in a good, refillable, filtering water bottle.

Because a lot of bottled water is not special and plastic is definitely not green.

Happy hydrating.

Image credit: Plant Nanny

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