An old saw says that in Washington DC politics is in the water; if that’s true, than technology is in the water in and around Silicon Valley. I lived there from 1977 to 2003 and just as DC media focuses exhaustively on Federal politics our media delved into the technology world, especially at two ends of the spectrum—startups and iconic brands.

Hewlett Packard is beyond iconic—it’s legendary—and dissecting what was happening and why was a media constant.

That hasn’t changed since I left; the latest being the Hurd fiasco. I followed the stories from the original news flash, not all of them but enough to understand what happened and some analysis, but I still felt something was missing.

I kept thinking that if Hurd was really terminated for the reasons stated then he was terminated for cause, which would mean no 40-50 million dollar severance package, but instead he was allowed to resign.

Something didn’t smell right or maybe I was just suspicious because the little I knew about Hurd didn’t impress me, but, then, who am I to disagree with all the experts who raved about his turn around of HP.

A Joe Nocera’s column Friday in the NY Times offered up a more logical reason for his ouster; one that makes far more sense to me.

According to Anthony Bianco, author of The Big Lie: Spying, Scandal and Ethical Collapse at Hewlett-Packard, “There was a residue of mistrust because of the pretexting scandal. I conclude in the book that he lacks the moral character to be C.E.O.”

Then there were the company’s employees. The consensus in Silicon Valley is that Mr. Hurd was despised at H.P., not just by the rank and file, but even by H.P.’s top executives.

Worse, Hurd gutted R&D, selling HP’s future for the short-term gains that Wall Street loves.

In the final look, the people who must be trusted to do the right thing in the running of large companies is the Board, but HP’s Board has proven over and over that it lacks what it takes.

On the other hand, putting up dazzling short-term numbers that have the effect of enriching himself while robbing H.P.’s future — isn’t that what a C.E.O. should be fired for? Firing Mr. Hurd for that reason, however, would have taken courage, something that has always been in short supply on the H.P. board.

What do you think? Read the column, come back and share your thoughts.

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Leadership has become a catchword, a panacea, a supposed solution to whatever ails us as a nation and a world. It is what people get degrees in, strive to be and worry that they are failures if they aren’t recognizes as leaders.

There is a fantasy that positive leadership is an integral trait of positional leaders no matter how many times that has proved to be a false assumption.

Another assumption about positional leaders is their ability to see the big picture; also proven to be untrue. Here are two excellent examples of narrow, short-term thinking—one stupidity that just happened in a small biz and the other from a corporate titan 56 years ago.

The former is another stupidity from Subway, the company best know for $5 foot longs and a bullet-ridden foot. The most recent foot shot happened in Dartmouth, NS when a worker was fired for giving her own lunch to two fellow apartment dwellers after a fire left them homeless (she also offered them lodging in her own apartment which wasn’t damaged in the fire); Quiznos, being more publicity-wise, hired her.

The older stupidity was perpetrated by the original Bell Labs, one of the most prolific research organizations that ever existed, and is a story that has been repeated in one way or another by companies large and small ever since.

Executives recognized that many of those moving up the management ladder lacked the broad thinking skills that would enable them to function as leaders in the future, so they set out to provide an intense program to remedy the situation. The remedy succeeded beyond their expectations in that the attendees learned to thing for themselves and those thoughts didn’t dovetail with the slavish corporate mentality the executives desired the program was shut down, … executives came out of the program more confident and more intellectually engaged, they were also less interested in putting the company’s bottom line ahead of their commitments to their families and communities. (I hope you take a moment to read this fascinating story.)

It should be noted that authoritarian leaders, whether of companies or countries, have always known that education and strong positive values are anathema to their continued power.

How do you define leadership?

Join me tomorrow for a look at this question.

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Budget woes are disrupting state and local governments and everything they fund. Cuts are being made and what better place to cut than those things that don’t show up immediately? Things that are either out of site, like infrastructure, or that can be pushed off to when times are flush(er), such as learning.

As most CEOs will tell you how better to reduce costs than to reduce headcount? And that means firing teachers—more than 100,000 come June and that’s not all.

As a result, the 2010-11 school term is shaping up as one of the most austere in the last half century. In addition to teacher layoffs, districts are planning to close schools, cut programs, enlarge classes and shorten the school day, week or year to save money.

Politicians, especially local pols, tend to focus on supplying instant gratification to their constituency in order be reelected, so even as the economy improves you can’t count on the money being replaced and teachers rehired—assuming they are still available.

It’s far easier to use smoke and mirrors to show that kids are doing just fine in the brave new reduced budget world—smoke being standardized tests as viewed through the mirror of lowered standards.

Education offers little in the way of instant gratification to voters, rather it offers whining kids complaining about homework, tests and tough teachers who have the nerve to expect them to stop texting, pay attention and learn. (What nerve.)

Not all kids are whining, some in New Jersey are protesting the cuts approved by voters .

The mass walkouts were inspired by Michelle Ryan Lauto, an 18-year-old aspiring actress and a college freshman, and came a week after voters rejected 58 percent of school district budgets put to a vote across the state (not all districts have a direct budget vote).

The full damage of cuts now won’t be felt for years to come, but the voting public has both long and short-term memory loss and the pols who did it will be long gone—or moved to a higher level.

And America will be left wringing its hands and moaning about its loss of world leadership and the incredible difficulty of finding good talent to hire.

Image credit: 19melissa68 on flickr

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Several years ago I read an article discussing what Gen Y wanted in their workplace. I found it somewhat amusing since the “unique” traits they wanted from work and management weren’t very original; I found the same thing earlier this year and they are the same traits I’ve heard from candidates for better than 30 years—long before Gen Y was thought of, let alone born.

But when I read a Talentbrew post about Gen Y’s attitude towards the recession I was floored—for at least 3 minutes.

While the capable of us have taken on the roles of Gen Xers and Boomers, we’ve likely done it without a raise, or at best, a minimal one.  Put simply, this infuriates us.  Gen Y was given constant positive reinforcement. We had piggy banks full of allowance earned just for making our bed or cleaning our own room.  The worst player on the team was awarded a “Most Improved” trophy.  When the economy changes for the better, we expect to be compensated, handsomely, for our efforts. Or we’ll leave.

How’s that for a sense of entitlement?

I know comments such as this are like waving a red flag in front of a bull, so I sent the link to Jim Gordon.

Jim graduated last June and is in his first job; he draws the Sunday comic mY generation and I often bounce stuff off him to be sure I’m not wildly out in left field.

After thinking it over for a few days, here is Jim’s response.

Alright, after picking through that article, I find it easy to sympathize with the author.

It’s very difficult for me to have any semblance of trust in my employer when I, and everyone around me, is being contracted.

It’s not that turnover is high either, but instead I have this air of uncertainty every day when I walk into work – will today be my last?  Every month or two, I have a new neighbor, though my position has a bit more staying power.

I find it very hard to say I “deserve” something, though.

I feel the author of the article insinuates that he/she deserves much better.  While I agree that often the scale from which our pay is currently derived is, well, off to say the least, I don’t think somehow the definition of “fair play” reflects the same way on society today.

I don’t mean to sound like an underachiever, but really the way one views the economic crisis depends upon how that person was raised.

I don’t agonize over short-term losses (4-5 years), but instead plan for the long-term (10-15).  Build thick skin, know what it’s like to lose, accept denial, appreciate acceptance, and move on in a self-centered direction.
Vanity is one attribute I will defend, which is seen as a flaw of Gen Y.  Assuming we learn from our mistakes, we know what it is like for a market to polarize.  Why?  That’s ALL some of us know.

We were living the life in the 1990’s, but “not much compares to a recession like this.”  That last bit was quoted from, well, everyone.  People who have experienced deep recessions say this, people who haven’t—everyone goes back to the point that this is really one of the worst recessions on record.

You know what, though?  I’m going to survive it and use it as a tool to build a road to where I want to be.  I’m not going to expect 5-star treatment afterward.

I may find another job, but that’s because, like many who have done so before, I want to find something that adds more value to me and my life.

That means I wasn’t taught that the world is an oyster—I was taught that life is tough, and (to quote The Rolling Stones) you can’t always get what you want…

Read the final paragraph in the Talentbrew post to learn what it will take to hire Gen Y in the future.

The only cosmic justice I see here comes from knowing that it is Gen Y’s parents who will be hiring and managing the attitude they raised.

Image credit: KM Photography.. on flickr

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How do you define success? Do you (or your boss) look only at the numbers and other recognized metrics or do you go a step further and evaluate the harder-to-define areas? Numbers and other business metrics are important, but they measure mostly the present, i.e., short-term results. What does long-term success look like? How can you evaluate yourself in terms of long-term success? Do you care? If your answer to the third question is “no” then you probably won’t be interested in the rest of this post, but if it is “yes” read on. Whether you are a newly promoted supervisor or Fortune 100 CEO, one easy way to know if you are succeeding is to ask your team. Asking is like a 360 degree review without all the bells, whistles and forms. It’s immediate and gives you a fairly accurate reading of the trust level of your team. If you hesitate to do that or your people won’t provide honest feedback then

• Your hesitancy means you already know there is a problem and aren’t comfortable with, or not interested in, changing to accommodate the feedback.
• If your people won’t be honest then you have propagated a belief that the messenger will be killed and that belief is typically entrenched in a larger culture of fear.

Either way, the source of the problem is you—not your team or even the general company culture (unless you are CEO), just you. You made it happen and if you want to fix it I suggest you have a long talk with your MAP because that is where the problem lies. The good part is that it’s your MAP and your choice to change it. Your comments—priceless Don’t miss a post, subscribe via RSS or EMAIL Image credit: ZedBee|Zoë Power on flickr

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Yesterday I shared quotes from Amazon.com CEO Jeff Bezos that focused on entrepreneurial topics, especially stock and its price.

Today, we’re going to look at Bezos’ vision for Amazon marketing.

Let’s start with what you thought of the last Amazon ad you saw. You’re probably scratching your head and thinking that it wasn’t very good, since you don’t remember it.

There’s nothing wrong with your memory or the ad, for that matter, because there was no ad.

That’s right, no giant ad budget, no super-size presence at tradeshows, no typical corporate marketing.

“Instead of shelling out big bucks for lavish trade shows and TV and magazine ads, Amazon pours money into technology for its Web site, distribution capability, and good deals on shipping. … “It is pretty unprecedented that their brand has ascended so quickly without a large marketing budget,” says Hayes Roth, chief marketing officer at brand consultant Landor Associates. “It’s not about splaying their logo everywhere. They are all about ease of use.”

Amazon has done well in the recession for the very reasons that Wall Street lambasted them after the dot com bubble burst.

Wall Street wanted short-term profits, while Bezos focused on the long-term.

When I was looking for yesterday’s quotes, I also found these two and they say it all.

“If you do build a great experience, customers tell each other about that. Word of mouth is very powerful.”

There are two kinds of companies, those that work to try to charge more and those that work to charge less. We will be the second.”

It takes enormous strength of character to stay focused on the future when investors are pounding on you to focus on immediate returns.

Too many CEOs sell their company’s future by focusing on keeping investors, analysts and the media happy in the short-term.

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I want to share three comments from Jeff Bezos today, because tomorrow’s post is about him.

They all focus on the financial side and point up the great difference between Bezos and many other CEOs when it comes to money and stock.

If Bezos is anything he is pragmatic and real—no BS. And that is just as true when he is talking about entrepreneurial topics as about his business.

The truth in this comment has only increased over the years and will continue into the future. “Good ideas will always get funded, so that’s not going to be a problem. But you will see that it will be harder and harder for bad ideas to get funded.”

“It’s part of the territory with Internet stocks, that kind of volatility. It can be up 30 percent one month, it can be down 30 percent in a month, and a minute spent thinking about the short-term stock price is a minute wasted.” Obviously, Bezos never wasted any minutes on the subject.

If you’ve followed Amazon at all, you know that every time Bezos invested in better technology or added product lines Wall Street predicted its imminent demise. Even today, after a decade of success, the analysts question Amazon’s every move.

Bezos takes it in stride, still focusing on the long term and customer satisfaction, as he has all along.

“No. I’ve taken plenty of criticism, but it’s always been about our stock price and never about our customer experience. After the bubble burst, I would sit down with our harshest critics, and at the end of the meeting they would say, “I’m a huge customer.” You know that when your harshest critics are among your best customers, you can’t be doing that badly.”

Join me tomorrow for a look at Bezos’ approach to nonmarkteing.

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When I wrote The Swamp And The Alligators: a (slightly irreverent) guide to career planning and the search process I had a chapter on career planning. Here is the first paragraph

“The world we live in is not conducive to planning in general, let alone long-term, i.e., strategic planning. There are very few good, visible role models who practice strategic planning. Elected officials don’t plan beyond the next election, while the government doesn’t seem to plan at all. Wall Street’s de facto definition of long-term is one quarter and companies are forced to accept and act on that definition or have havoc wreaked upon their stock. Even short-term planning is more reactive (fire fighting) than pro­active. When planning is done, it’s frequently approached as a project comparable to climbing Mt. Everest with the end product required to outlast the Tablets.”

That was more than 15 years ago and nothing’s changed—people still aren’t comfortable planning.

There’s a simple trick to planning, whether for your career, family or company and I’m going to share it with you. In order for it to work, you have to stay conscious of the idea behind the action all the time.

Are you ready?

PLAN IN PENCIL

It doesn’t matter if you’re using a computer, plan in pencil.

Planning in pencil means accepting at the outset that plans change as life changes and that’s OK.

No person living or dead could have predicted the current economy. Even those who saw the looming problems in derivatives and sub-prime mortgages couldn’t forecast what is happening.

Plans need to be flexible, to bend and sway with the winds of fortune and the life changes that can’t be predicted.

PLANNING IN PENCIL is a state of mind, the part of your MAP that allows you to move forward at warp speed, yet still turn on a dime.

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Steady readers of Leadership’s Future know that I am thoroughly alarmed and dismayed by the Millennial MAP (mindset, attitude, philosophy™) regarding such mundane stuff as accountability, honesty and entitlement along with the No Child Left Behind fiasco and its focus on grades-for-funding.

Two articles caught my eye this week, both on a very positive note.

Education

The first is an overview discussing what Arne Duncan, the new education secretary, did in Chicago and wants to do nationally. It’s not perfect, but it’s a lot more than we’ve seen in years. Not only that, but the price tag per school isn’t that outrageous considering what I’ve seen previously and he doesn’t seem to expect states to pull the funding out of thin air as NCLB did.

It won’t be a silver bullet (what is), but maybe we’re finally moving (glacially) in a positive direction.

Parenting

The second article is even more encouraging, since it looks at parents—who are at the heart of this mess.

Like most other things, parenting styles change—call it parenting-by-fad.

But I see this new fad as a move in the right direction. It’s about letting kids play, doing less and (maybe) realizing that your kids are not the center of the universe or even your primary purpose in life.

How’s that for revolutionary?

Can you imagine? Instead of having every minute of every week packed with scheduled functions, parents would expend some of that energy making sure that their kids used the free time to run around, play using their imaginations, read, think and dream, as opposed to texting, keyboarding or watching TV.

They could use some of the extra time and energy that went into keeping their offspring on schedule to staying involved with their spouse and some more on feeding their own soul.

They might even have enough energy to learn to say ‘no’ and stop indulging their kids to the point of entitlement.

Sounds like a trip to Fantasy Island, but who knows, it might be part of the recession’s silver lining.

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Possibly the most difficult question for any is business:

“Is it time to pull the plug?”

Business Bankruptcies up over 100% since 2006

In this difficult economic environment, many businesses are answering that question simply, “yes.” As the chart below shows, business bankruptcy filings grew dramatically in 2008, up over 100% from 19,695 in 2006 to 43,546 in 2008.

This chart is deceptive, because the average annual number of business bankruptcy filings for the 28 years 1980-2008 is 52,667 and the number of filings in 2005 was 39,201. So the 43,000 filings in 2008 are 20% below the long-term average and just a little above the number in 2005. But, regardless of the long-term average, the short-term trend is up over 200%.

Time to Pull the Plug on My Business?

Setting aside statistics, the question at hand is real, personal, and immediate for many small business owners. As a professional business consultant, I work with several clients struggling with this question.

One of my clients generates approximately $3,000,000 in revenue and supports 25 employees. For the past two years, this company’s revenue has remained flat, with annual losses of $250,000 or so. This year revenues have declined and the owner has kept the monthly losses to $20,000 by reducing expenses. So far, so good, right?

Will the situation improve in the near future? Is a turn-around in sight with just a little more patience and persistence? When does persistence become stubbornness? When is it time to pull the plug? How do you know? Forgive this barrage of questions—this is an extremely difficult, emotional question for a business owner.

What Are Your Choices?

As a business unit manager, you have the opportunity and responsibility to make major changes in your business. 2% solutions don’t count.

What few significant changes can you make to improve the problems facing your business?

• Eliminating People Means Eliminating Work. You simply cannot eliminate people and leave the workload unchanged. How can you reorganize your business to reduce the work? Can you automate or outsource back-office services or sales? Can you move more functions online? Can you move your customers to self-service online? Can you use online order / payment to simplify the sales and collection processes?
• Don’t Eliminate Products. Eliminate Production Costs. Can you shift inventory and fulfillment services to suppliers or third parties?
• Don’t Eliminate Value. Eliminate Overhead. Do you need all the office space, telephones, equipment, and software? Eliminate, reduce, or find it for free.
• Grow Revenues. Be careful here, as increasing revenue is extremely difficult, especially in this recession economy. It’s easy to forecast big growth, only to be surprised three months later when the growth has not appeared on schedule. First, find a few customers for your services, and then forecast the growth based on their orders.

You Already Know the Answer

Three business aphorisms provide some insights into this question:

• The universe rewards action.
• Ready, fire, aim.
• Follow the money.

Taken as a set, they offer a road map to making this difficult decision.

If your business is struggling, then do something! The business (universe) will respond to your actions.

If the business situation is getting worse, you have limited time and budget to make meaningful changes. This is not the time to be shy. Take some dramatic action. That’s the “ready, fire” advice.  Observe the result. Based on the result, quickly adjust your actions to improve the outcome (aim).

Finally, follow the money to your desired outcome. You know your budget for time and money. When either one runs out, you lose your freedom of action. Take action now, while you still have freedom to choose.

The biggest obstacles to meaningful business change are usually not intellectual understanding of the problem, or a lack of options, but emotion and fear.

For instance, most business owners truly care for their employees so layoffs are difficult. “What will my employees do without this job? How will they survive?” If you are considering major changes in business direction, fear raises similar questions about you; “How will my company survive if I make this change? What will I do with my life if my company fails, or if I have to shut it down?”

Together, emotional attachment and fear of the future create a paralysis, even in the face of clear impending disaster. When you wake up at 2 AM, what is on your mind? If you can get past the emotion and fear, I believe you already know the answer. “Don’t go wobbly,” as Margaret Thatcher famously advised George Bush senior when he was preparing for the first Iraq war. “I just don’t know,” is a cop-out.

What is Your Biggest Fear?

If your company is losing money each month, you must make changes. In this economy, your business will not get better by itself. What is the single change you fear the most?

Turn off the computer, put down the cell phone. Be still for a few moments, sitting with your fears and emotions. What is your biggest fear? Go there. Do it.

Wishing you the courage to make the difficult decisions,

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