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Leading change

Listen closely to how today’s business and political leaders talk about change. How many of them are talking about preparing their businesses, our cities, our states, and our country (much less the world) for change?

More often than not, their conversations are about slowing down, stopping, or reversing changes – ignoring a future that will arrive whether they like it or not. (No, I’m not referring to the virus.) These leaders might appear to be in charge of leading change (or at least managing our response to it), but most of them aren’t actually doing anything of the sort… not really.

The majority of the conversations are positioned in terms of the good old days, whether that was 10 months, 10 years or half a century ago. A few are talking about a future that will advance at a pace not unlike the pace of the last 20 years. The idea is that we manage an unforeseen next five years with the thinking learned a decade (or three) earlier, expecting the pace of progress (in either direction) of the next five years to match the pace of change of the prior five years.

“There are no situations and no exceptions where a subordinate is ultimately responsible for the performance of a team. It is always the leader’s fault.”

Jocko Willink

Perspective

The problem with trying to manage all this with thinking from the good old days, or with thinking formed while working with the pace of change over the last 20 years, is that these approaches fail to recognize the current reality: That the pace of change is increasing constantly.

While the jaded might think this perspective is intentional, I suspect most of it isn’t. Some of it is a lack of vision. These folks are too tightly coupled to a reality / situation they need or want to defend, even if it’s from another time and place. I’m speaking broadly here: not specifically about any one business, personal situation, financial position / viewpoint, etc. We have to be very, very careful how we choose business and political leaders as we move forward. Look back at how technology and automation changes have caught leaders and groups of leaders (like Congress) completely off guard.

An obvious and somewhat recent example is that they’ve had to react well after the fact to the impact of the internet, robotics, genome technology, etc.

As an example, is the internet a utility? (because that means we can put an existing administrative organization and rules in charge of it) Is it a service? Is it a monopoly? Is it a right? Or do we decide that it’s another kind of telephone call so that we can use all the old phone regulations to manage it? (and thus, protect it or ruin it, depending on your outlook). Look back at rural electrification for clues.

Our leadership choices become more important every day because of the increasing pace of change. The virus has helped a lot of people understand how exponential change works. When exponential change takes hold, 15 quickly becomes 300, and in the space of a couple weeks becomes 30,000 then 100,000 and so on.

What we’re ill prepared for from a leadership perspective is that change itself is changing at an exponential pace.

Important at all levels

It isn’t important solely at the Federal level. It’s important at every level from the Feds all the way down to a seemingly innocuous city / county position on a board. Imagine that a local county board member considering an important decision. Does it matter if their vote on a health topic is based on their evaluation of information collected by qualified, highly-experienced, trusted people in the county, or is it OK if the decision is made based on the Greeks’ four humors?

Let me simplify this a bit. Is it a bad idea to eat week old sushi? Does it depend on the status of a diner’s humors? Whether the topic is sushi aging, inoculations, water rights, or traffic circles – do you want someone whose mindset is mired in the 1700s making those decisions for you?

Dealing with change isn’t easy. As humans, we tend to avoid it by our very nature. As Chris Hogan says “Nobody likes change, but everyone likes improvement.” Even so, leading change – usually in advance – is leadership’s job – whether they like it or not.

It’s not hard to look around and find examples that show how difficult it is for leaders at all levels to keep up with the changes that have occurred over since 1980 (OMG was that really 40 years?). Compare not just the changes between 1940 and 1980 to the changes between 1980 and 2020, but the pace of change in those two periods.

Now consider that we’ve even accomplished many of the things many people expected of us 80 or even 60 years ago. Where are the flying cars?

Influence & management

The easiest place to see this is in emerging industries. Look at software, computers, drones, the internet, medicine, or really – anything we’ve struggled to keep up with in recent decades. Some industries have benefited from the lack of understanding by elected / appointed leaders, even though this may not have served us well over the long term.

Sometimes those industries become massive, wielding significant influence ($ talks) before leaders manage to figure out what they do, how they do it, and what the impacts might be. This can be a good, bad, or neutral thing, and is probably split across all three. The important observation is that we need the kind of leadership capable of dealing with a future that’s coming whether we like it or not.

We’ve all seen an industry that does something incorrectly, builds a low quality product (or a product with a serious flaw) that causes a substantial loss of value, loss of life, etc. It’s rare to hear that leadership has prepared a company in advance for these issues by rethinking how they design, build and deploy products and services *before* they launch, but it does happen.

The normal context of corrective action and/or putting safety corrections in place “What can we do so that never happens again?” It’s as if we’re completely incapable of theorizing, thinking a process through from beginning to end, testing in real world situations, validating results without using situational ethics, etc. While the law of unintended consequences can find a way to make the best of intentions seem inept, we shouldn’t empower it. We’re often more concerned about how to handle it the public relations angle or “optics”.

When it makes sense to consider how we’re going to make sure something never happens again, it tends to be spoken of and executed in the same mindset and terminology that created the problem. Put those two together, and you have a cadre of business and political leaders that are wholly unprepared for the future, and in fact, don’t seem to recognize what’s going on around them. We can do better.

It’s impossible to go back

No matter how wonderful or awful you felt back during the good ole days, regardless of which decade that identifies, the 40s, 50s, 60s, 70s (etc) are all but irrelevant to use as a comparison when trying to lead people, companies, and governments today.

It’s impossible to go back. Even if we could, the things about those times that we and leaders have conveniently forgotten about the good ole days could hit us with the force of an angrily swung two by four.

We conveniently forget that change was difficult back then, just as it is today. Maybe you were a kid at the time, or maybe you’re old enough to have been a leader back then. Either way, there’s no doubt that your mind has hidden the hard parts of that decade (not to mention the really hard parts). It’s probably not intentional, but simply how our memory works. Ask your grandparent or parent about your favorite decade. They may remember it differently than you do.

If your leaders want to take your company or your community back to one of those decades because they thought it was easier to lead in that decade, bear in mind that you get ALL of that decade – not simply the parts folks fondly recall.

Do we outlaw the things we blame for today’s difficulties? Are you going to outlaw electrical power? Are you going to outlaw wireless communications? Are you going to outlaw the use of silicon? (ie: to make computer chips) If so, do we also outlaw the use of any sort of technology to improve our lives? What about improvements in clothing, food, medicine, etc? What about radial tires? Plastic? Radar? Jet-Skis? Color TV?

That’s what leaders are talking about when they suggest it’d be best to go back to those times. When your leaders say they’d like to take us back to some chosen decade, what they’re really saying is that they can’t cope with what’s going on today (or that they’re not willing to try) – and that they believe the same about you.

Tomorrow’s change is the job

If they can’t handle today, how will leaders handle what’s going to happen tomorrow? It doesn’t even matter whether the “unhandle-able” thing is positive or negative.

To be sure, it’s not just the negative things. It’s also the positive accomplishments that industry, groups, and individuals create. People lose their minds over the fact that some change is going to impact them. Rather than consider the possibility of the impact of those changes, they simply double down, refuse to accept them, and do everything they can to stop the change from happening, often without pausing to learn anything about the change other than what they were told by a self-proclaimed expert on Facebook.

Leading through tomorrow’s change is leadership’s job.

As an example, we (collectively) worry about the rise of self-driving (autonomous or semi-autonomous) cars, forgetting that cargo ships, airplanes, spacecraft, and other things have “self-driven” for years. Most of the deaths and “accidents” involving these technologies tend to happen when humans turn them off, override them, or use them improperly. To be sure, these situations are not limitedt to that. Technology failures exist, and the introduction of human error, ego, and/or over-confidence don’t help matters.

Consider the number of plane crashes caused by pilot error. The number is fairly small, but the percentage is not so small. Depending on the source of the data, the percentage of crashes determined to be caused in some way by pilot error is 75-80% (Google it), with the remaining 20% or so mostly related to equipment malfunction or weather. The number of actual crashes is small, thanks to a combination of technology refined over many years and flights, combined with a group of highly trained, highly experienced, very disciplined people (flight crews).

As romantic as it might seem, do we really want to go back to the DC-3 or the Ford Tri-Motor?

Change is everywhere

Earlier, I referred to the need for leaders who can handle rapid change all the way from the Federal to local levels. You might have thought that it’s overkill to expect local leadership to need the skills, vision, and insight to cope with these things. Perhaps it seems we don’t need that because we don’t do that sort of work around here.

Thing is, that kind of change is happening almost everywhere.

While there have been all sizes of software companies in Montana for at least 25 years, that’s not the technology I’m referring to. A decade or so ago, a different sort of technology company started popping up around Montana. We had energy storage technology firms, cryogenics firms, and more recently, a nanomedicine company.

Yes, nanomedicine. In other words, researching and creating solutions to medical problems using tools and technology and treatments created at the nanotechnology scale.

Nanotechnology is the branch of technology that deals with dimensions and tolerances of less than 100 nanometers, especially the manipulation of individual atoms and molecules. What’s a nanometer? One billionth of a meter. In other words, cut your yard stick into one billion pieces lengthwise and you’ll be close. A billion can be hard to grasp. If you cut that yard stick into a million pieces, to get a billion, you’d have to slice those million slices one thousand times. We’re talking small.

This is the kind of change that’s happening everywhere. It’s the change that business and political headers must be able to discuss and encourage, not merely tolerate and be aggravated about.

The research and the solutions that nanomedicine yields is performed by people with PhDs, undergrad degrees, and in a few cases, even undergrad students, programmers and clerical folks. As you might expect, there are salespeople and other not-as-technical roles. This work doesn’t happen just in NYC, LA, Silicon Valley, Asia, India, and the Harvard / MIT corridor, but right here in your state.

Not limited to new industries

These changes are not solely the domain of “super high-tech” industries. Look at the advancement of mechanized, semi-automated, and automated timber processing over the last few decades. 30 years ago, those were a figment of someone’s imagination.

Today, it wouldn’t surprise me if somebody is working on an autonomous version of that equipment that will automatically understand what parcel of land it’s on, what species the tree is, how old the tree is, what grade the tree’s wood is most likely to be, etc.

This team of machinery could choose the highest value trees to harvest, present them to another robot who would transport it to another robot which will prepare it for transport, and put it on a truck. Maybe that truck will be autonomous. Another group of robots might do slash cleanup, and still another would return after slash cleanup to replant. All of this is probably old news to someone working on timber harvesting technology.

While that doesn’t kill the timber business, it’ll certainly have a major impact on it. For one, the lumber business will become even more capital intensive. A yard full of autonomous robotic equipment that can do this work won’t be cheap. The development and testing processes alone will be incredibly expensive.

Such equipment would render the timber business far less human intensive, even though the currently available generation of felling and harvesting equipment has already lowered manpower requirements. Just look at the machines that a single operator can run and how much work they can get done in a day. For the specialist walking those acres and working today’s equipment, these changes may feel like a threat. A phrase like “lowered manpower requirements” doesn’t hide the fact that a family’s breadwinner still needs work.

New products, old products

Leadership includes helping that industry, its workers, and affected communities adjust, and prepare to thrive in a new future rather than simply giving up and leaving everyone to fend for themselves. Leaders help create a better future, even if it’s a slightly (or substantially) different one.

Some leaders might think that it’ll take 20 years for that robotic equipment to make these imagined industry changes become reality, so they think they have plenty of time. They might be thinking “I won’t even be in leadership or political office 20 years from now, so why bother even thinking about it?” However, when we look at the rate of change in the capability and price of robotic technology over the last five years, “that’ll probably take 20 years” starts to seem a bit ridiculous.

I wouldn’t be surprised to see intelligent robots whose harvest is planned by a professional forester who reviewed robotically collected timber data from the site. This might involve some sort of mapping expert, even though the foresters I know are mapping experts. Maybe there will be someone to guide those robots similar to how a drone pilot guides a drone flying over the dangerous territory.

Perhaps this robot will be able to sense certain kinds of animal habitat, human habitat, watersheds, legal boundaries, bodies of water, etc. Maybe it will be able to detect data on animal movement (etc) and send it back to the “home office”. It’s possible that combining that data with other piece of data from some other machine or location could prove valuable to the logging company, the landowner, or someone else. Land has many uses and so does the data observed about it.

Where do the jobs go?

Somebody’s going to need to know how to repair those robots. We’re going to need to know how to train a company’s people to operate and maintain them, program them, etc. The vendor who creates them can educate them on all the different species that they would want to sell them to, you know, for customers who would need them. But there’s always localized information about that sort of thing.

“Localized information” could be data that comes from and/or is refined by people – perhaps from the same people who have walked that land for years. It may involve localized robotic programming or data curation of some kind involving a species expert. Robots will need educated timber firmware or something like that. The data will constantly change as weather, moisture, harvest, growth and other data changes.

Where does that leave the truck driver and the folks that are out in the forest doing this work? While some of it is dangerous, high-risk work, it’s also good paying work. Leaders can’t abandon those people, but they also can’t stop the change. Helping employees, communities, and companies adjust to these changes on a reasonable timeline before a crisis occurs is what change-ready leaders must do.

Capital talks

This is not just a leadership challenge. It’s a challenge for education and financial systems. The ability to see where their industry is going, and help students and employees avoid getting themselves pigeonholed in a career that’s disappearing is the responsibility of everyone involved – education, leadership, and the employees themselves.

There are numerous financial implications. You buy a house, a car and perhaps you buy or lease a logging truck. You hire a bunch of folks to get out in the woods and do the work, and then you find a competitor found a way to get their hands on one of these automated timber robots. Their margins might suddenly be much higher than yours. Either they make far more profit, or they undercut your price. You’re stuck because of your overhead.

What do you do? You don’t have a few million to buy robots. One solution is to look back at how these problems were solved in the past.

Cotton gin & timber math

Consider Eli Whitney’s cotton gin. Only the most financially successful farmers could afford cotton gins when they were first available. Others had to compete with those who had the mechanical gins. Whitney figured out his prospective customers had a capital problem, so his company rented them to farmers for a piece of their crop. That allowed his company to grow, while getting his machinery into the hands of farmers who would struggle to compete without one. The last thing he needed was a shrinking, consolidating industry.

Likewise, robotics is a capital intensive business. It takes a lot of time and capital to design, prototype, test and manufacture robots. It requires engineers to design, people to test, programmers to program, foresters and others to identify all the necessary species, collect and refine the data, and so on. It requires buying robots that manufacture your robots, and people to install, manage, repair, and monitor that manufacturing process.

Once these machines work, the math is difficult to ignore. (Sound familiar?) If a set of robots can, in a week, do the work 100 men complete in a week, then someone will start doing the math. If they don’t, they’ll soon have to compete with someone who WILL do the math. The math will change quickly as the robots increase their productivity.

“The math” means figuring the full extrapolated cost of those hundred men, their equipment, their fuel / food / medical care, training, pensions, health benefits, managers, supervisors, transportation and so on – then comparing it to the traditional cost of getting that work done. Somewhere in there, there are fixed and variable costs. At some point, the robots will make sense financially, or maybe they won’t. Time will tell. In some industries, they will. We’ve already seen that.

If they do make sense, the robot sellers can take a page from Whitney’s sales manual and say “Look, you don’t have to pay anything up front, simply pay me a percentage of your haul once you get paid.” At that point, the game changes.

On-ramps are critical

If leaders wait until the game has changed, it’s too late.

When some of these employees and contractors find that they aren’t needed anymore, or that the number of companies who do need them are steadily shrinking, it’s starting to be too late. At first, some of the people are needed for fewer shifts. At some point, the work they do might not be needed anymore.

If we’ve not prepared for that, and are unable (or unwilling) to prepare people to be ready for those transitions, we (and they) are going to get a surprise. You may think it doesn’t affect you because of what you do, but these dollars flow freely in the community. It will affect you at some point, even if the effect is caused by career changes for someone who lives 1500 miles away.

It isn’t about being ready for a legal 60 day layoff warning requirement, so you can decide it’s time to find something to train them for. That’s too late. It’s about being ready for the new thing no later than when a substantial industry change starts to gain traction. A 30, 60, or 90 day delay / break in the ability to generate income can destroy the economy of many families, despite the best of intentions by that family to save, etc. We’re at the early stage of that as virus-related layoffs accelerate. Skilled people need to be ready to transition in advance. They can’t be trained overnight. The leading / bleeding edge folks will see the benefits early. They’ll quietly train their own people and implement these changes.

Not only do people need the income because they’ve got a mortgage to pay and kids to feed (etc), but there will be immediate needs to deliver on the commitments of companies that put these pieces of equipment in the field (and those who don’t). You can’t wait 60 or 90 days or longer for somebody to become expert enough to do the new work. Equipment breaks down all the time. It needs to be configured, transported, maintained, and deployed today. Companies at the leading edge of that transition will need trained people to do this work. Leaders need to help create the on-ramps that help them get there.

Change doesn’t care

Change doesn’t care about our feelings, our likes & dislikes, much less the tender underside of our comfort zone.

The pace of change is even less considerate. The key is not to fight it, but to leverage it. The one thing you can’t do is stop it.

Choose leaders who can handle change. Cultivate new leaders to engage with it.

Photo by Robert Gomez on Unsplash

Categories
Leadership Management Small Business

One thing to prioritize next year

As we approach the new year, you’re probably thinking of things you simply must get done for the coming year to be a big success. It’s a good bet that your “must do next year” list is long. There’s a good chance you’ll never complete it, at least not next year. Look at that list for what it is: Far more than you can get done in a year. That’s OK.

When we sit down and think about all the things we could do for our business, our team, and our customers – there will always be more things than time to do them. While we know this, it discourages us because we didn’t get it all done. To paraphrase Drucker, doing it all isn’t the important thing, doing the right things is.

Reflect & Prioritize

Last week, I mentioned your mile-long ToDo list and segued into managing the pace of change for your team to prepare for today’s discussion. Thinking about the year that’s about to end, how many major things did you get done?

Despite all that work, I’m sure you have improvements to make, new efforts to build and roll out (whatever that means for you), and other work to do. You aren’t alone. We all have a laundry list of important things to grow and improve our businesses.

When I look back on my year, I can think of two fairly major things and a longer list of less-substantial efforts. Probably forgotten is a laundry list of things that took less than a day or perhaps less than a week. I’m pondering this without looking at the system I use to manage such things. I’m sure I have forgotten medium sized projects that I now take for granted. The little things aren’t unimportant, but they aren’t the subject of this discussion. Still, there’s a massive pile of things I haven’t touched.

Sure and I have work to do

Rather than being disappointed about what you didn’t get done, appreciate what you did get done. It starts with looking at what you really can get done next year and how you’ll stay on the path.

I have 786 items in my project manager. Some small, some large. They won’t all be completed next year. Obviously, only a few are worked on at a time.

I prioritize the big things on my list on a weekly basis. The rest get reviewed monthly. Priorities / needs change for all of us. Something that was important six months ago might be irrelevant (or super critical) now. It’s rare that the most important things to complete in the next year will change, but it happens.

Your cycle of review / prioritize might be different, but it’s still needed. Imagine if next year you complete the three (or six) biggest items on your list. Today, that might seem crazy (“Crud, I have 780 to go”), but what impact will the six biggest items have? Only you know.

Yeah, but the Jones’

You may see other businesses getting a ton of new things done or perhaps more big changes than you could possibly do. Don’t think you don’t stack up, or that you aren’t as good as them. They may have more time, free capital, staff, or whatever. It doesn’t matter. Don’t get trapped in the comparison thing. Remember that what you see is only part of the story. You have no idea if they’ve made unsustainable decisions to accomplish what you see them doing.

Your ToDo list will live a long time. It will grow and shrink repeatedly. There will be big things and little things. They’re important in their own context, but they aren’t the biggest thing.

While getting it all done, remember to prioritize being a better you next year than you were this year. If you need a daily reminder in your calendar to do the things that make this happen, so be it.

Challenge your team to do the same and help them get there. Show them what you’re doing to improve, even if they need to do something else. Share your struggles and successes so that they know the path isn’t without challenges. Some will need some help figuring out what that means, what to do first / next, and how to get started again after tripping up. Be a leader in that respect, whether you’re the owner or not.

Photo by Mauricio Fanfa on Unsplash

Categories
Business model Entrepreneurs Leadership Management Small Business

Small Business Scorecard

I’ve long focused on helping businesses one on one, by choice. From time to time, I’ve considered mechanisms (other than my writing) that provide help in a group setting. Ideally, this would let me help more people while not drastically increasing the time required to do so. Typically, this means holding webinars, group coaching, masterminds, ie: “one to many” events. This piece is intended to fill some of the gap between one-on-one help and one-to-many help, at least for now.

How we get help differs

When it comes to seeking help, business owners appear many forms. Some repeatedly seek help from people, books, and other resources. Others tend to accept help about specific topics, or when a resource is recommended to them by a trusted friend. Some read or listen to many sources of help / advice, but are pretty choosy about the things they implement. Some seek no help at all – and this group seems to be broken down into a group that knows they need the help but never take action, and another segment that simply figures it out on their own (or doesn’t).

Efficient learning varies from person to person. Some prefer reading, while others learn / retain more from audio, video, pictures and/or diagrams. Some people prefer brief information, others tend to consume “long reads” or extensive, highly detailed video. This time around, I decided to take a self-guided approach. I’d appreciate feedback on how effective the scorecard is for you – and why.

How the scorecard works

I’m calling this a scorecard, but the goal is not to arrive at a number and think “We got a 74, so we’re doing fine as is.” It’s more of a self-assessment & introspection tool. You’ll find statements about how things work in your business. You’ll agree with some. Others will have you thinking “That’s definitely not us.” If a seemingly-negative item on the list doesn’t pertain to you, cross it off. Look at the items you circled / checked as “yep, this is us” as a milestone on the way to a stronger company. Some may need recurring attention.

Marketing

  • Our marketing is completely automated across all media, digital or otherwise.
  • Our marketing is strictly digital. We don’t make sales calls, send US Mail, visit prospects, have prospects visit us, and we don’t go to trade shows.
  • Our marketing is strictly organic. We don’t advertise, other than having a website.
  • We test new ads against our ad that performs the best.
  • We market our work consistently.
  • We spent ad money effectively.
  • We have data that tells us what works and what doesn’t, marketing-wise.
  • Our marketing is executed based on a plan or marketing calendar.
  • We collect information about people who show an interest in our products / services.
  • On a regular basis, we reach out to people who have shown an interest in us. We send offers as well as useful information that will help them make a purchase decision.
  • In marketing dollars, we know how much it costs to get a highly-qualified lead.
  • In marketing dollars, we know our lead cost on each type of media.
  • For each of the media we use for marketing (radio, tv, newspaper, direct mail, various internet options), we keep track of lead quality, lead volume, and ad investment.
  • We decrease our marketing efforts / spend when the market is tight.
  • We use our lead cost to drive decisions about ad purchases – including internet ad options.
  • We increase our marketing efforts / spend when the market is tight.
  • We don’t really advertise with any consistency. You might say it’s driven by which ad salespeople call on us.
  • In our market, expertly-done marketing has ceased to become an edge. Everyone in our market is a good marketer.
  • We decrease our marketing efforts / spend in good times.
  • Most companies in our market are spray-and-pray marketers.
  • Some companies in our market are haphazard or random marketers, but there are some that we’d consider experts. They spend ad money effectively.
  • We increase our marketing efforts / spend in good times.
  • We’re one of the haphazard / random marketers.
  • We’re one of the more effective marketers in our market.

Operations

  • It feels like things “fall apart” a little when critical people leave, or are out of the office.
  • When the owner or manager are gone for the day, things seem more productive.
  • When a team member is gone, it’s easy to deal with their workload because we’ve been cross trained.
  • When someone is out of the office, it can be a little tough, but we have written process / procedures documentation to help us get the work done.
  • We rarely / never have to contact someone who’s out of the office to ask them how to do something, or to get online and help us deal with this or that.
  • When our front desk takes order / job status calls, they have to call back into the shop to get someone to tell them what’s up with an order / job.
  • We sometimes run out of the supplies / raw materials we need to do our work.
  • It’s common for us to contact someone who’s out of the office because we need help dealing with something they do.
  • Customers can tell when a critical employee is on sick, off that day, or vacation.
  • When a customer contacts us to find out the status of a job / order, any employee can easily and quickly find the info and pass it to the customer.
  • Customers can’t tell when a critical employee is out of the office.
  • We never run out of the supplies / raw materials we need to do our work.
  • We use a system to track and manage our tasks / work.

Business model

  • Our products / services are one-off. We don’t make something once and sell it multiple times.
  • Once we make tooling, we can make and sell the same item repeatedly.
  • We sell services on a subscription basis.
  • The business doesn’t generate income when the owner isn’t working.
  • We serve a vertical (narrow) market.
  • We sell products and service them, so ongoing reputation is critical to get returning customers.
  • If we’re not on the job and billing hours, we’re not generating revenue.
  • We serve a horizontal (wide) market.
  • Our market has already been disrupted / is difficult to disrupt.
  • Once created, our services have a marginal COGS so we can make something and sell it repeatedly.
  • Our customers pay us each month. We deliver / replenish consumable products / services.
  • Our market could easily be disrupted.
  • We provide customers with a service infrastructure.

Staffing

  • We’re always understaffed.
  • We have trouble keeping people, but they don’t tell us why they leave.
  • We have trouble keeping people. They tell us why they leave, but we can’t or won’t do anything about the things they mention.
  • Customers can’t tell when an employee is brand new.
  • Our people rarely do things together outside of work.
  • It takes a long time for us to hire someone because we’re careful to find people who fit our existing team.
  • Customers can tell when an employee is brand new.
  • We have trouble keeping people. We’re not sure why.
  • Few of our first line managers are familiar enough with the line employees’ work to take over for them in a pinch.
  • It takes a long time for us to hire someone because candidates are hard to find.
  • We’re overstaffed, but our workloads vary wildly so we don’t want to shrink the size of our staff.
  • Our team is a family – they frequently do fun / family / activities together outside of work.
  • Our first line managers could easily handle the work our line employees do, if they needed to.
  • We tend to promote from our existing staff.
  • We rarely promote from our existing staff.
  • Our team tends to be swamped one week, and might be sitting around with nothing do the next week.
  • Most of our team members are easily replaceable.
  • We have employees who have been here for many years.

Sales

  • Our sales team says they never have enough leads.
  • The sales team feels our leads are properly qualified when they get them.
  • Customers and prospects comment that our sales team was useful in helping them make a purchase decision.
  • Salespeople often comment that they’re getting leads who aren’t suitable for our products / services.
  • Our pipeline is difficult to confidently predict more than a couple of weeks out.
  • We have quotas, but we aren’t involved in deciding what they should be.
  • We close an acceptable-to-us percentage of sales when we have a highly-qualified lead.
  • I feel confident when I give a solid lead to one of our salespeople.
  • We have sales quotas – and we’re involved in determining those numbers.
  • We’re constantly under pressure to make quota – and we know it’s because the company’s cash flow is precariously low.
  • We get very few complaints about our sales team.
  • Finance is always bugging us to give them pipeline information, but we can’t consistently tell them anticipated revenue more than a week or two in advance.
  • Our sales team has an experienced leader.
  • It’s not unusual to get comments that our sales team is pushy.
  • Finance really appreciates that we can give them dependable sales pipeline info 30-60 days in advance, so they can depend on revenue in advance of receiving it.
  • Sometimes people send in feedback saying our sales team is more interested in closing a sale than they are about helping customers decide on a purchase.
  • We have more leads than our sales team can handle, but not all of them are well-qualified.
  • Our sales quotas feel like impossible expectations rather than achievable goals based on lead flow.
  • Our sales team is lead by the salesperson who usually sells the most.
  • We have more highly-qualified leads than our sales team can handle.
  • We believe that our product / service makes a significant improvement in the lives of our customers and as such, it is our obligation to offer it to as many qualified prospective customers as possible.
  • Our sales team easily handles all the leads we give them. They keep asking for more.
  • Most days/weeks/months, our sales team can handle the leads assigned to them.

Management / Leadership

  • You can ask any of our employees what motivates us as a company, or “What’s our why”. They all know.
  • Our people are an investment in our business.
  • We have to constantly watch our people to keep them working.
  • Our managers are all family members who learned to manage here – and it’s worked great for years.
  • Our people feel like a cost / expense.
  • Sometimes new employees have to wait to get a phone, desk, computer, tools, or a space in the shop. Those things aren’t always / usually available on their first day.
  • Employees know what our company long and short term goals are.
  • We’re an open book company.
  • Our managers are all family members who learned to manage here. I think the company would positively benefit from an experienced leader.
  • We don’t share any financial performance information with our people.
  • When a new employee get to their desk / work station / shop station on their first day, they have everything they need to get to work.
  • We have a 401K.
  • Team members don’t seem to connect their work with the company’s goals.
  • It takes new employees a few weeks / months to get their act together and become effective.
  • We routinely discuss the importance of 401K participation in our employees’ future.
  • Our financial performance is none of our employees’ business.
  • Any good manager could join us, learn our business, and be effective here.
  • Only our family can manage this business.
  • Our employees understand what makes our business profitable and sustainable.
  • New employees often comment about how good / refreshing our on-boarding process is.
  • We encourage our employees to educate themselves and offer ongoing training as well.

Finance

  • We know where the funds for our next payroll will come from.
  • We’re always on top of the required state and Federal reports related to employees and such.
  • Sometimes we have to pay our invoices late, but it’s not an every month thing.
  • We get paid late by our customers and it creates issues for us.
  • We don’t have receivables.
  • Our payables are always behind.
  • We never have any issues with state or Federal tax returns or deposits.
  • We’re always on top of tax returns.
  • If sales could deliver dependable pipeline numbers for the next quarter, our finance problems would disappear.
  • The owner / management hates accounting.
  • We’re always up to date on tax deposits.
  • We’re not very good at managing the company’s finances.
  • We tend to be late on tax returns. Sometimes we have to pay a penalty.
  • Managing our finances is one of our superpowers. We suspect we’re better at this than many other companies.
  • We tend to be late on tax deposits. Sometimes we are charged penalties / interest.
  • We do all our own bookkeeping and accounting / tax work.
  • Debt is an important ingredient in our ability to grow.
  • We do our own bookkeeping, but we have a professional handle the taxes and related paperwork.
  • We outsource bookkeeping.
  • We’re focused on eliminating debt for the long term, even though we know it may slow us down from time to time.
  • We have a professional handle taxes and related paperwork.
  • Our “numbers” drive strategic decisions.

Systems

  • We understand that “systems” might include automation, but also may include manual systems – such as checklists, documented work processes, job descriptions, manufacturing reviews, and similar items.
  • New employees learn our systems as they learn their job.
  • We’re gradually systemizing parts of our business.
  • None of our systems are “perfect”, but our imperfect systems save time, keep us on track, and help us avoid missed steps.
  • There’s one person who knows it all on our systems, but that’s it.
  • As an owner, I ask myself “Whose job is this?” every time a piece of paper crosses my desk.
  • Our systems are a strategic advantage. They make our work safer and more consistent. They help us produce a more consistent outcome for our customers.
  • We routinely review our systems with feedback from the people who use them. Reviews drive upcoming system improvements.
  • The nature of our business requires that we invent most or all systems ourselves.
  • We don’t have anything we’d call “automation” but we’re definitely a systemized business.
  • We have several team members working together to know, improve, and manage our systems.
  • Over time, we train new employees on all the company’s systems so that they help in any area if someone is out.
  • We understand that automation / systems can be leveraged in any part of our business, from management to finance to manufacturing, sales, and/or marketing.
  • We’re using systems and ideas that others have refined over time.
  • Systems (and particularly automation) are something we need in order to keep up with competitors. If we didn’t have to, we’d use as few as possible.
  • Our systems have been in place for years. We rarely change them.
  • Our systems are very close to ideal. We’ve worked hard to get there.
  • Our systems are difficult to change.
  • Our systems are a mix of commonly-known systems from experts and systems specific to our industry and/or business.
  • We train new employees on all the systems in their area.
  • Adding new systems to our work is easy.
  • It’s difficult getting new systems into our workflow.
  • When we hire people. we look for experience in systemized businesses and experience with systems like ours.
  • If we find job candidates with experience with systems unlike ours, we consider this useful as we might gain an edge from that differing background.

Photo by Dan Meyers on Unsplash

Categories
Employees Management Small Business

Retiring business owners

I consistently meet business owners who are about to retire, considering retirement, just retired, or are somewhere between those places.
I suspect this happens because I’m on the north side of 50. No matter the reason for these encounters, I wish retiring business owners planned a bit more for the run up to retirement. They tend to have the personal side of things handled. On the business side, my experience is that the typical retiring business owner plans to either close the business down, pass it to family, or find a buyer when they decide it’s retirement time. In some cases, there isn’t a lot of advance thought into the approach to this possibly massive change in the business.

You might be thinking that you don’t necessarily care about likely changes that can occur after the sale – no matter their nature. Thing is, buyers do care. Buyers write a check or get a loan for a presumably large sum of money. Getting a good return on that investment is always on their mind.

Employees also care about the changes that can come with a buyout. Things that create concerns among new owners are staff morale, the staff’s surprise to find that there’s a new owner, the staff’s concerns about the viability of the business, etc. “Why’d they sell it?” “Are we going to lose our jobs?” “What about the redundant positions between the two companies?” “Will there be staff cuts?” As a retiring business owner, your mind is elsewhere. This may seem like it isn’t worth worrying about. Even so, these concerns are quite normal. Think back to the days when you were an employee.

Employees and changes

Employees always have concerns when a business changes hands. It’s not hard to find stories broken promises made when a large business is bought by a new owner or merged with another. Everything is champagne & roses at the press conference in an effort to keep everyone calm & avoid disrupting the business. Employees aren’t dumb. They’ve seen friends & family deal with these situations. They’ll be understandably concerned that they’re in for the same. If you don’t have experience with this, ask around. I doubt it’ll be hard to find someone who’s had a bad experience with this. Anyone from Columbia Falls can explain it.

Morale is always a concern. New owners bring a new culture to the business. The change may or may not be positive. If your staff doesn’t have to worry about that once the sale is announced, they’ll be less distracted & concerned. They’re less likely to be involved in gossip about what might / might not happen with the “mysterious” new owner. This may seem silly to worry about, but people work for you for a reason & money isn’t all of it.

If you’re nearing retirement age, your team has already wondered what you’re doing with the business at retirement. They just haven’t asked you. You might think it’s none of their business, but they often ARE your business.

Before finding a buyer

Finding a buyer sometimes happens quickly. For some, it can take years, which can be excruciating to a wanna-be retiring business owner. There are so many dependencies. Sometimes it comes down to luck. Someone happens to know someone who is ready to buy and things simply happen to match up.

Make sure your business is truly ready to be sold. That means it’s ready to buy, take over, and run. Processes are documented. Job descriptions not only exist, but they’re up to date. Accounting is clean and tightened up. Marketing pipelines are reasonably consistent. Sales conversion is predictable. Supply lines and vendor relationships are solid.

Make sure there are as few “bodies” as possible. When I say “bodies”, I mean “bad things I’m going to find if I dig enough”. You might have heard this phrased as “I’ve been here long enough to know where all the bodies are buried.” It’s a perhaps roughly toned way of saying that you know the good & the bad of a business. The strengths, sure. But also the weaknesses that few know, much less talk about.

The fewer bodies that exist at “Hey, we’re for sale” time, the better. Most prospects won’t see them. The truly interested? They’re exactly the ones who will dig deep enough to find them – the last ones you want to give a reason to walk away.

Photo by Tim Mossholder on Unsplash

Categories
Entrepreneurs Management Small Business strategic planning

Selling your company

In Silicon Valley, “exiting” means a company you started / invested in went public or was bought by another company. It’s a time of celebration, reward, & anticipation of the next big project. When you are selling your company, it’s often different. For some, it’s an escape. For others, it’s the achievement of a long-anticipated goal. Are you prepared for it?

Is your company ready to sell?

The process of getting a company ready to sell is really about getting it running smoothly. It’s easy to think of it from the “E-Myth” perspective & focus on “systematizing” your business, but there’s more to it. Put yourself in the shoes of a buyer during due diligence.

They’re looking for proof. Signals that provide assurance.

They want to see data that indicates how your company performs. If you have good, verifiable data, you don’t need to make big claims. Let the data talk. For example: You can probably predict gross revenue over the next 90 days with a fair amount of accuracy simply by gut feel, but can you show data that supports your prediction? How you do this will vary, but many use some form of leads-per-month and conversion rate.

Sidebar: One conversion rate calculation is the number of leads who buy during a period divided by the number of leads you gained during that same period. If you get 1000 leads a month & sell to 520 of them that month, your conversion rate for that month is 52%. Sales cycle length & other factors can complicate rate calculations. Keep it simple.

Selling your company requires leading indicators

Measurable business performance can be difficult to extract solely from financials, which produces trailing indicators. Income history over time is good to have, but it’s a trailing indicator. A trailing indicator is one that documents how the company did last week, last month, last quarter, last year, etc. What about the future?

Buyers want to see leading indicators. Data that accurately predicts future performance.

A leading indicator uses verifiable data to reasonably predict how the company will perform next week, next quarter, etc. Restaurant reservations are a leading indicator: You can predict on average that 78 people will show up for dinner if you have 100 dinner reservations for next week.

Lead counts (inbound phone calls, website opt-ins, etc) function both as a trailing & leading indicator. Imagine you got 100 new leads a day on average over the last two years. Let’s say your close rate on sales hasn’t changed during that period. If your average sales cycle is 60 days long, you should be able to predict income quite accurately for the next 60 days. Why? Because the lead count is steady and so is your close (conversion) rate. While this ignores changes in prices & costs, it reasonably predicts future gross income.

Why are you selling your company?

When someone approaches you about selling your company, it’s often done without provocation. You haven’t listed the business for sale. You haven’t indicated that you’re ready to retire. “I’m not ready“, you might think.

They see opportunity. Sometimes they see synergy with their existing business. Maybe they want to buy more customers. Their reasons are theirs. What are yours?

When you ask owners in this situation what they really want, they’re often unsure. There’s nothing wrong with that. You don’t always know what the next step beyond business owner is because you haven’t thought hard about it. You’ve been focused on running the company, growing it, & taking care of customers. It’s OK if you haven’t put serious thought into what a sale really means – even if you always knew you’d sell someday.

A big check” is too simplistic an answer for some, because the business is a big piece of who they are. Some want a role in the company after the sale. Many don’t. Some care what happens to the company, the customers & their team. Some don’t.

Owners often have a number in mind that they would take. The first number I hear is rarely based on hard numbers, desired ROI / payback period, etc. Remember that a buyer is purchasing assets (most likely) as well as an income, whether they’re an individual or a company.

When it comes to selling your company, your “why” is as important as theirs. Think about it and get your business ready.

Categories
Buy Local Employees Entrepreneurs President-proof Restaurants Retail Small Business

The butterfly effect of a shutdown

This past weekend, my wife & I shared a cold one at a local brewery while discussing the shutdown. Pundits and others wave off the shutdown’s impact as “a small percentage of the Federal workforce”, as if it’s trivial. Trouble is, the headcount of furloughed Federal employees creates a butterfly effect that ripples outward to almost every sector of U.S. business.

Shutdown data & families

800,000 Federal employees are currently going without pay. Slightly fewer than half are furloughed – meaning they aren’t allowed to work. More than half are “essential workers” – required to work during a shutdown. Those working will receive back pay once the shutdown ends, but furloughed employees have no “guarantee” of receiving back pay.

The shutdown affects about 3.2 million employees & family members. My non-scientific extrapolation assumes four members per Federal employee household. There’s income flowing into those households if they have two employed people if one isn’t a Federal employee… maybe. Perhaps the two jobs depend on access to childcare. If one is unpaid, can they still afford childcare? If one employee is “essential”, both still have to work. Result: childcare is necessary. It’s not uncommon for both family wage earners to be Federal employees. I know a number of couples who both work for the USFS or Park Service, having met at work when they were single.

You’ll hear some say these people don’t matter and/or that they don’t care if they’re paid. You should. Their economic activity (or change in activity), regardless of their financial condition & habits, is what creates an economic butterfly effect in towns all over the U.S. (Update: 1/9/2019 from the NYTimes based on US Gov data: https://www.nytimes.com/interactive/2019/01/09/us/government-shutdown-state-by-state.html?smtyp=cur&smid=tw-nytimes )

The local economic butterfly effect

Federal employee families have mortgages, eat in restaurants & go to bars. They get oil changes, rent movies & purchase medical care. These families own businesses (like a favorite local brewery), buy raw materials, & employ people. They buy gas, clothes, donuts, firewood, cleaning services, plumbing / electrical repairs, groceries, etc.

This economic activity creates revenue for all local businesses. If you run a restaurant, bar, or other business near a Federal building – it’s likely that a lot of your business comes from Federal employees. TSA folks get a coffee/meal at an airport business. I suspect that activity will shrink at every U.S. airport.

Tax refunds often pay for vacations, bills, & down payments on large purchases. Loaning the Feds money at zero interest may seem unwise, but the economic impact is undeniable. The IRS does not pay refunds during shutdowns.

The now-closed IRS income verification service will eventually impact home purchase closings. Mortgage approvals use the service for income verification. Home purchases affect local banks, real estate agents, closing firms, home inspectors, and home repair contractors, among others.

Local breweries that can / bottle beer are stuck in line waiting to release new beers. The Federal agency that processes over 16,600 beer label applications per month is closed. Someone sells them hops, malt, yeast, bottles, cans, labels, & graphic arts. Someone manufactures & delivers them. Some puts that income into investments, savings, tuition, a home, etc.

Closed or limited Federal lands access can more directly affect local businesses. In West Yellowstone, Montana Public Radio reported that Xanterra and 13 other local businesses managed to arrange a temporary deal to pay the park to plow the roads & groom snowmobile trails in Yellowstone. While $7500 a day is expensive, the alternative is a lot of lost revenue & people out of work during winter peak season. There aren’t a lot of open jobs in West Yellowstone, so even one business laying off its entire staff could create a cascading nightmare for a small town and its families. A snowcoach business owner in the area mentioned that the deal keeps his 14 employees working. Businesses in the Mammoth, Cooke City and West Yellowstone areas are likely thrilled about the temporary deal.

That option isn’t available everywhere.

Butterflies & ripples are different

In a pond, ripples get smaller in height as they expand their reach toward the shore. When they reach the water’s edge, they might barely be noticeable. The butterfly effect works in reverse. Each wave is bigger and interactions create more waves.

As each of these economic impacts ripples outward, it affects more and more people & businesses. At first, the impact is small. Over time, these small impacts accumulate and start to push family & business finances over the edge. Not just those of Federal families, but everywhere. Want to help out? Buy local.

This highly scientific diagram is an incomplete and highly simplified representation of a part of this discussion. Note that it doesn’t include every Federal agency, nor does it include cash flow lines between families who own local businesses to other local businesses.

Categories
Management Small Business

Really bad advice

If you know people who have owned their own business for a long time (or maybe not so long), they’ll have lessons to pass on. What you’ll typically receive from these people is rarely (if ever) going to be bad advice. I suspect most of these folks will be happy to suggest things you shouldn’t do, as well as things they recommend doing.

Here’s the secret process to making this work for you: Find a business owner. Ask an open ended question, like “What do you think about (something)?” In the meantime, here’s some really bad business advice for you. You may detect a little sarcasm. Or a lot. 

It’s OK to fall behind in bookkeeping. No one really keeps up with it anyway, right? Also, never get a bookkeeper, even if you think you might only need them part time. You can handle it. 

Never guarantee your work. As long as you’ve been paid, the job is done. The consumer needs to do the legwork to figure out who does quality work and who doesn’t. They are expected to take on 100% of the risk of their shopping choices. 

Ignore your customers once you get their money. If they want something, they’ll tell you. Until then, leave them alone until they show up with more money. 

Customer service is a waste of money. Your customers are smart enough to figure out how to use your products and services. If they aren’t, they’ve already paid. The really stumped ones will pay again even if they haven’t figured it out. 

Be difficult to do business with. It gets rid of the lazy customers and those who aren’t willing to cater to your way of doing things. Or maybe you should be easy to do business with. You decide. 

Safety isn’t a big deal. If your existing folks get hurt, you can always find new people to take their place. 

Internet security risks are overblown. All the hype about viruses and hackers and stuff is mostly made up to sell software that probably doesn’t do anything. 

Never call references. There’s really no need to try and find out if a candidate is motivated, or lazy, or awesome, etc. Don’t call them. Just keep hiring people and replace the bad ones.  Calling them is a waste of time because it’s almost certain that their lawyer has advised them not to tell you anything. If they’re a smart person like you, they probably don’t have a lawyer and do it all themselves. Doesn’t matter. They still wouldn’t tell you because that airline magazine said don’t tell anyone anything if they call about former employees. 

Try to be your own lawyer or CPA. Everyone thinks this is a good idea. I know all I need to know about lawyer-ing from that Law and Order show (Whomp-whomp). Accounting and the law is nothing more than math and stern letters. 

Marketing is for losers. If your product or services are good enough, you shouldn’t need to waste time and money on advertising.  

People don’t need to be trained. If they didn’t know what they were doing, we wouldn’t have hired them. 

Salespeople rarely tell the truth. Even better, they rarely stick around for more than a few months, so it’s OK to pay them low commissions. Since they won’t be around long, it’s cool if they make up stories about your products and services as long as it closes a sale. 

Foster a dog-eat-dog mentality among your employees. If they’re competing with each other, they’ll either get better or quit. They’ll also be too busy jockeying for position to spend any time getting together and causing trouble.

Never assume that your clients are smart. Presumably you’ve never suggested that your work is easy enough for your clients to do without you. If they were smart, you wouldn’t make so much money specializing in cleaning up the carnage caused by do it yourself clients.

Databases and customer relationship management is for people who can’t close. Relationships with customers are something for people who can’t sell.

When in doubt, use sarcasm. Seriously, though… All of the items above are obviously (I hope) sarcastic suggestions, so do the opposite. Business is hard enough without taking bad advice, particularly sarcastically bad advice.

Categories
Employees Management Small Business

Between a rock and a hard place

Labor Day seems like a good time to talk about…. labor. Montana has a few labor conflicts going on right now. A commonly solution to such problems is for the employees to organize. In other words, they’d become employees subject to collective bargaining done on their behalf by their labor union.

Why do my employees want a union?

First, let’s talk about how an employer might find themselves in a place where their employees want to organize.

There are a number of reasons why your employees would want to be in a union. The best reason is that you hire skilled plumbers, electricians, riggers, iron workers, welders, etc. In other words, you need people with highly specific skills. These skills are usually in heavy demand – and today is no exception. Trade unions have historically been a great resource for training and managing the full career life cycle for highly skilled workers like those described above.

However, trade unions aren’t typically the ones you often hear about in the news. Instead, you probably hear more about organized labor unions. A fair percentage of them were provoked to organize due to poor behavior on the part of the employer. 

What provokes employees to organize? Poor pay and benefits are obvious, but it sometimes goes beyond that. Poor leadership, which often creates a culture no one would choose to be a part of. Pushing everyone to fewer than 30 hours a week so that you can avoid some benefit costs. Consistently using inconvenient scheduling such as split shifts. Cutting staff to the point where employees can’t take the vacation time they’ve accrued. Creating separately organized companies for groups of employees. This is done to avoid hitting “headcount” thresholds that require additional employee benefits and/or record keeping. 

When not to organize

Recently, a situation has arisen in Montana where a company told its people that they must either lay off the majority of their employees or close the business. This business was purchased a short time ago by a company who owns many businesses in their market. 

It seems clear that the purchased business (a former competitor) was bought to remove them from the market. Happens all the time. Now the purchased “sort of competitive” (my words) business is being killed off. Employees affected by this are trying to organize a union. This tactic is intended to prevent layoffs and/or avoid closure of the business. 

I don’t believe organizing is a viable long-term solution to this problem. When negotiating, it’s important to be able to trust whoever you’re working with. Avoiding negotiations with such parties is recommended unless you simply have no choice. If they plan to shutdown, how well will negotiations go?

Will it work?

Applicable wisdom: “When people tell you or show you who they are, believe them.

This company has consistently demonstrated what to believe about them.  They buy decades-old, locally owned businesses, then slash staff and ship many of the jobs out of state. The work these businesses do doesn’t benefit from remote work. Doing this work from out of town actually puts the business at a significant competitive advantage.

Organizing a union with a company like that is probably going to result in employees being treated poorly within the terms of their contract.  That’s if they succeed in getting organized before the company shuts down the business. I think that’s a long shot. I don’t believe organization is going to stop this company from completing their shutdown plans.

The path to a long term solution for these employees is probably to start a competitor. I know it won’t be easy. 

Difficulty created in advance

It gets tough when employees decide they need to organize when there’s almost no chance that the business is closing. The relationship between the company and employees just before organization is usually sour. Leadership needs to look in the mirror during these situations. A little research into what happened prior to organization might help. The patterns are fairly consistent, even if the details vary. 

If your team feels like they’re the enemy, organization is a likely solution they’ll choose. People want consistency. They want some security that they’ll be around next month. Fear based management is a fast path to resentment and your team lacking any feeling of security.

Ego-free discussion between all parties is likely the sole route to business survival.

Update: Tuesday Sept 11, 2018
A single day after this post was published and 17 months after buying the business discussed above, the corporate parent locked the doors of the business and closed it. With no advance notice of the closure, they emailed all the employees telling them that the business was closed (they also called some and left voicemail). Employees were told not to visit the office and that they could make an appointment to pick up their things. They are paying their salaries until early October 2018. In other words, their behavior has not changed, as predicted.

Categories
customer retention Customer service Getting new customers Small Business

Reviewed your public internet access lately?

Last week, I was in Chicago for a seminar. As you might imagine, public internet access is important to business travelers. My hotel had internet, but browsers and Outlook both objected when I attempted to connect to any secure site or resource. When I switched to the wifi hotspot on my phone, those issues disappeared. When I reached wifi at other locations, those issues didn’t reappear.

Verdict: hotel internet was misconfigured, broken, hacked, or some combination thereof.

Reporting the problem

I reported the problem Monday afternoon to the front desk and to the hotel’s customer service account on Twitter. By the time I checked out early Friday morning, the problem still existed. It took their corporate Twitter people 28 hours to respond, despite the fact that they’re a substantial global hotel chain – or perhaps, because they are.

I noted to the Twitter reps that I didn’t expect the front desk to be network experts, thus I was reporting it to them so they could get the hotel property some corporate-level network help. This didn’t happen – at least not yet.

Their response was to contact the hotel manager. Based on his post-checkout email to me, he had no idea what I was talking about. As previously noted, I didn’t expect him to. Even better, they accidentally forwarded me the internal corporate support team email with the case number and all the contacts, all while leaving this hotel manager hanging out in the breeze to figure it out on his own.

So how does this affect you?

Public internet access quality matters

I don’t want to turn this into a geeky network security post. I mention it because there’s a lot at potential risk when networks offering public internet access have problems like this.

When your customers connect to a secure site from your wifi & that network is misconfigured, it may simply prevent use of the network. If your business is frequented by business customers, fix this quickly as you don’t want them to leave and decide never to return.

You may not think this is a big deal, but business customers do – especially if they’re on the road a good bit. Don’t think of them as one person who “isn’t even a local“. Think of them as all business travelers (or tourists) as a whole. There are sites and mobile apps out there that guide people to businesses with good internet. If your internet is bad and your coffee and croissants are awesome, many of these folks will go elsewhere.

If a regular traveler finds a spot to settle in for an hour or two of work and that spot is dependable, they’ll never forget it and they’ll return every time they’re in town. BJ’s Coffee in Forest Grove, OR comes to mind immediately for me.

If your network is hacked, the risks go well beyond repelling customers. Worst case, the bad guys can “see” your network traffic and send it to a place where they can store and review it. If they have what appeared to be in place at the hotel I visited, they can gather logins, passwords, credit card and other account numbers and so on.

While it’s not a good idea to use the same network that you offer to your customers, if you do so & it’s hacked like this, info on the cards you run could be at risk, even if you passed PCI-DSS certification a few months ago. To be sure, this depends on the hack, your network config & other things. The details aren’t the point.

The risk these situations expose you to …. that’s the point.

Add “network health” to your regular checkups

On a regular basis, you probably check in with your lawyer, doctor, CPA, and a couple of other advisors. You do this to reduce / avoid risk, maintain good health (physical and/or financial) and keep yourself out of trouble.

I suggest adding “network people” to that list.

Ask them to help you lock your network down without making it impossible / annoying to use (there is a balance to be had). Ask them to show you what to check and how to detect when something is “not right” so that you know when to call them for expert help. This landscape changes often. Your network and the equipment, customers and data that touch it are assets. They need protection too.

Photo by Giuseppe Milo (www.pixael.com)

Categories
customer retention Employees Habits Small Business

What’s a lifelong career lesson you depend on?

I graduated from college with a BS in Computer Science back in 1982. The timing was unfortunate. Interest rates had gone through the roof, cratering hiring, so the tried and true 1980s “every programmer graduate can find a job at an airline or oil company” situation was gone. My school’s BSCS was a very new program and really was more like a general engineering degree (lots of calculus, plus diff-e and more math, several physics courses, etc) with some programming courses tacked on. There wasn’t much resemblance to what most would consider a classic BSCS curriculum, but it didn’t matter too much back then.

My first job after college was at Ross Perot‘s Electronic Data Systems (EDS). Skipping forward several months, I came out of their training program, which everyone went through regardless of their degree. Didn’t matter if you had a CS degree or a history degree, you went. After training, my first mentor was a guy named Randall.

My first serious career lesson

Randall was few years older and had become a rising star in that area of the company. He was easy to look up to. He was smart, a bit of a jokester and someone people came to when they needed solutions to tough challenges. You could see what that meant to him and others. Unlike some in the tech space, he was happy to teach and provide access to resources to experiment with and learn from.

35 years later my strongest memory of Randall is a conversation that had a massive impact on my business life. It became a lifelong career lesson.

One day when I was tinkering around with something that probably had nothing to do with my job at the time (like an IBM mainframe virtual machine), he stared me down and said (paraphrased) “If you want to go places and move ahead (in this company), always be willing to take on new things even if you know nothing about them, then do whatever it takes to learn what’s needed.

It was years before I realized that his advice had become a consistent theme across that all the work situations I’ve been in since that time. It’d repeatedly been a door-opening differentiator. Thanks Randall, your advice that day was the most valuable thing a boss / co-worker / peer ever gave me.

What about “Business is Personal”?

I didn’t say there could only be one lifelong career lesson. “Business is Personal” is a business foundation, while Randall’s advice became a personal mindset & perspective.

The seeds of “Business is Personal” grew out of watching my photographer clients about 20 years ago. The level of personal touch that these folks maintained in their business was something much different than I’d ever seen. They thought about their relationship with their clients very deeply and used it to not only improve sales, but to create clients who stuck with them through each of the seasons of life.

In true “when the student is ready, the teacher will appear” fashion, my business life turned a corner thanks to these folks. I suddenly saw every business through a different lens.

As an employer and business owner, “Business is Personal” took on a litany of nuances, year after year. It became the foundation of my consulting and writing because it has a broad application and touches so many parts of the business. It not only became a foundation for running a business, but it’s also a filter for businesses that I’ll do business with.

Ripples

Some non-traditional (for me) work eventually exposed “Business is Personal” as a nuanced connection between businesses, their employees, and the local community. Acquiring, caring for and retaining clients stabilized and helped grow those businesses and make them more resilient.

That stability ripples across families, schools, and quality of life in a community, impacting job creation and retention, crime, local funding, tourism, etc. Yes, it’s Economics 101.

That said, when explaining the “obligation” to get better at sales, customer service and marketing to a business owner as a means of impacting quality of life in their community, rather than “just a way to make more” – the big picture jumps out at them.

I’m curious what your core career lessons are. Have you thought about it? Have you thanked those who first instilled them in you?