Categories
Employee Training Employees Leadership Management

On being essential

Is your business “essential”? I don’t mean the Federal distinction. I mean in view of those who you serve, because those are the only ones who matter. No matter how bad the economy or anything else in the future might get, is your business serving essential needs for your clients?

Essential people

The people you’ve hired are a big part of what makes your business essential to your customers. Finding, keeping, and training people who love to take care of your customers is real work. Taking “good care” of them includes training, coherent management, “real wages” and benefits.

A business doesn’t pay “real wages” and benefits because someone else wants them to. They do it because it puts their team at ease, allowing them to focus on the quality, speed, and value of their work. A team that’s not worried about their job has more headspace to attend to their work. It puts a fence around them, making it hard for others to poach them.

Essential customers

Reach out to your very best customers. Call them or write an email that’s very clearly personal and not mail merged. Find out what their concerns are. Do they assume you’re going to be around? Remove any doubt. If you’re having problems, be square with them. You should be asking them if there’s anything causing critical problems right now. Are they things you can help with? Tell them specifically how. If you can’t, can you suggest someone who can? Be the one helping, not the one just trying to make a transaction happen.

You probably know the customers who are most on the edge. What can you manage to do for them? Even a small gesture that buys them a little more breathing room is worthwhile and will certainly be remembered.

Made in your image

When I see a company doing things that make them less essential than they could be, I tend to break down what they do well and what can they do better. In many small businesses, the capabilities and behavior of the businesses mimic the capabilities and behavior of the owner. Most owners are essential to our business – at least until our business matures. Some of this “made in your image” thing is good. Some isn’t. I battled it for years, as many of us do. One of the battles was over bookkeeping.

I’m not a fan of accounting. Accountants are fine. The actual work of accounting and bookkeeping always made me crazy. I know, I know. Seems silly given what I do. It is. Ever have one of those things you know you need to get better at even though you really don’t like it? That was accounting for me.

The thing is, accounting isn’t there solely to keep the tax man happy. The quality of your business decisions will improve substantially as your understanding of your numbers improves. No, I don’t mean the tax code and all of that. I mean the numbers that fall out of day to day operations. They all fall to your books. They’re metrics, but not the normal kind I talk about. Lots of metrics tell a story – and accounting does too. If you don’t listen to the numbers (including the accounting ones), the story won’t go how you want it to.

Mirrors reflect everything

I tell this story to reinforce that my company was a direct reflection of me during my “bleah, accounting” phase and that was not a good thing. It was important to work on (or delegate) the things that I don’t want to be reflected from me. Becoming essential means doing those things for your business.

Unless you’ve worked at it, your business reflects the things you’re good at, as well as those things you need to work on. The mirror reflects everything in front of it. Your business doesn’t have to, but you have to make a conscious decision that this is going to happen.

You have to choose which of your behavior your business reflects and which ones it does better than you. This will, of course, require some delegation or some training, or perhaps both. For me, it was both.

Customers decide

Your customers decide whether or not your business is essential to them. The behavior of your company and the value it provides to your customers is how they decide.

Photo by Faye Cornish on Unsplash

Categories
Management strategic planning

Grandma’s Rainy Day

Almost every Saturday, my grandmother and grandfather would load up the LTD and my grandmother would head to the farmer’s market. In their area, it was a massive open air building under a roof. Every booth had a waist high table with edges and a hanging scale. We’d spend the day there, selling vegetables, butter and a few other food items.

After we got home, the first thing we’d do after I helped her unload the car is head to her dresser. She’d pull part of the day’s take from the farmer’s market and stuff it into a bank bag she kept in the back of her dresser drawer. The rest would stay in her purse. One day, I finally got curious enough to ask her about it. She called it “her rainy day money” and explained the idea to me. As a farm family, you never know what unexpected weather is going to bring. Even as a young boy, the possible impacts were obvious, even though I had no understanding of how devastating a major storm at the wrong time would be to their cash crop.

Prediction isn’t protection

That’s the problem with storms. Several decades later, our weather detection and prediction capabilities are much better, but it doesn’t matter all that much. Even with days of notice before the arrival of a massive thunderstorm, hurricane or untimely freeze, there’s still not all that much you can do about it unless you can harvest your crop before it arrives.

Sure, grandma can cover a reasonable amount of garden plants with a sheet to prevent freeze damage. You can’t easily cover dozens of acres to protect against a hailstorm or similarly damaging event. If you’re my grandparents and your only income is from that farm, then the rainy day fund could literally be a life-saver. 

Hurricanes and other threats

Hurricane Camille (1969) and Agnes (1972) both hammered their isolated farm with very high rainfall, yet I don’t recall my grandparents ever being in dire straits as a kid. Sure, grandparents don’t always share the extent of their financial situation with young kids, but kids notice things in adult behavior, particularly if it changes. I never saw anything that made me wonder – or they were good at hiding it.

My grandparents’ primary cash crop was tobacco. Extremely heavy rain early or late in the growing season can devastate a crop. Their crops were on sloping land, which I suspect was by design. Hail could destroy a crop. 

Farmers face many challenges, including market fluctuations, global relationships, and “Big Ag”. Grandma’s rainy day fund protected my grandparents personal economy on a scale that was workable for their small farm.

Another term for rainy day fund is business reserves. 

Hindsight is 20/20

Today, a lot of businesses are in a bad spot. Some have closed. I don’t know their situations, but I suspect some portion of them could have benefited from having a rainy day fund, or perhaps a larger one. I’m pretty sure that every business that’s been hit hard would look back and be grateful if their former self made sure they had 60 days of reserves. 

I don’t mean to make light of this or bust on you when you’re down. I’ve been there. I know how it feels. Building business reserves is hard, particularly when starting up or starting over. You’ve got demands at home. You want to take better care of your staff. Growth and other projects want their share. Every single dollar of revenue has multiple demands on it. Old news, but still true.

Work on your rainy day fund

I hope businesses that have taken a hit can restart and get back to business. It’s hard. You think back to all the challenges you faced over the last five years or so – knowing that restarting means you’ll probably have to face some of them again. 

Whether you’re starting over or not, knowing what you know now, consider budgeting a rainy day fund into your monthly business budget. Not “I should do this someday”, but a specific amount or percentage. Decide how much you want to have in reserve for some future rainy day. Carve it out every day, week or month. Maybe you already do this. If so, double down on your business’ ability to take a punch. It’s something you’ll never regret, plus Grandma will be even more proud of you. 

Photo by Craig Whitehead on Unsplash

Categories
Customer relationships customer retention Customer service Getting new customers

The end of delivery?

You might be thinking “When this is over, I can’t wait to get rid of ‘contactless carryout’ and the hurriedly-implemented delivery that’s keeping us afloat right now.

Don’t.

At some point, people will resume visiting your business in person. Some will wait longer than you expect. Some may never return, but not necessarily because they don’t need what you sell.

People have seen how a delivery-mostly world changes their lives – in particular, what it gives back to them: time, fuel, and maybe a little sanity. Even the most selective shoppers have been shopping online while supporting local businesses – without spending time in the aisles.

They see the benefits of discarding the recurring, time-consuming effort that used to consume part of their precious off-hours and weekends. Ever get home from a busy afternoon in grocery stores (etc) and wondered where your trail, bike, river, kid, grandkid time went?

Now, there seems to be more of that time. Yes, I’m talking about the time that was previously consumed by navigating parking lots, tolerating crowded stores, and standing in checkout lines because some stores have fewer checkers than ever.

Of course, some will resume “normal” shopping because it’s what they’ve always done, and because they enjoy getting out. Some never stopped. And some will never go back to their old normal.

People are picky

“Yes, but people are picky”, you might say. “They want to choose their tomatoes and broccoli.”

Yes, they are. Yes, they do. There’s room for that.

Delivery can focus on things like commodities, cans, jars, and bags of national, regional, and generic brand items that can easily be specified in their online order. This allows a delivery/carryout customer to get exactly what they’d choose without the time & hassle. After all, a can of DelMonte corn is a can of DelMonte corn.

With delivery, there’s no parking lots, no traffic, no aisles, no checkout line – and all that time can be spent doing something else. With carryout, you still avoid the aisles, checkout lines and parking lots since stores with carryout typically have designated areas for those activities.

For the things they’re choosy about, people can shop the farmer’s market, pick up their CSA allotment from a local farm, order from their favorite local butcher, and pick up their favorite “I’ve gotta choose” items from their favorite grocer. CSAs are already available for contactless pickup. Butcher shops and farmers markets will adapt as the market indicates.

Not everything is groceries

“Simple” situations like getting our groceries make the impact of these changes easier to see, but there’s one group this isn’t simple for: the businesses themselves. Their systems must be adapted. Their people must be trained for these new functions. The physical organization of a grocery store that’s ideal for a hundred or so simultaneous retail food shoppers is not ideally laid out for a crew of workers picking orders for grocery carryout and delivery. Your business may have a retail shopping vs. delivery/carryout order picking organizational challenge to work through.

But not every business is selling groceries.

I’m reminded of my mom and my grandmother. Both widowed, both avid gardeners and yard workers. They have their mowers serviced every spring and in grandma’s case, winterized every fall. Neither of them have a pickup. I don’t live near them. Somehow, their mowers get to the shop.

Obviously, someone picks up their mowers, takes them to the shop, services them, and delivers them to their home. Service.

Service: Still stylish

This isn’t only about older customers, nor is it only about mower shops.

Everyone has responsibilities, wants, & needs pulling them in different directions. It might be a month before someone can do the prerequisite tasks required of them to prepare to give you money. Pickup, delivery, & carryout can eliminate that delay. You get your money faster. The customer gets the work done earlier than they expected. Fewer people enter your business. Your employees are exposed to fewer people without impacting sales.

Even for those who are able to get their equipment (or whatever) into their vehicle, then drive to your shop, lift it out, & take it inside to get it worked on… Why should they ever have to do that again?

As economies reopen, you have a unique opportunity to create a new relationship with your existing customers, and build one with new customers that’s better than what they’re accustomed to.

Photo by Rémi Müller on Unsplash

Categories
Business culture Customer relationships Entrepreneurs Management

Predictions, models, tramps, & thieves

I know, you weren’t expecting a reference to Sonny & Cher.

Technical people (programmers, doctors, scientists and the like) aren’t typically considered to be good communicators to the public at large. Good communicators like Bill Nye and Neil DeGrasse Tyson stand out because they’re adept at explaining very technical subjects in a way that’s understandable to everyone. Sure, they have time to prepare, but that doesn’t guarantee content everyone else can understand.

This is one reason why we’re so frustrated with the inaccuracy of “predictions” about things like weather, fantasy football player performance, stock market behavior, hurricane tracks, asteroid paths, and COVID impacts.

How many science-y people in these roles are saying something like… “This is a model. This is how models work. A model is not a promise. It is a set of results from a bunch of calculations based on the data we have today – and the data we don’t have yet. When the data changes, the results coming from the models will change.

The lack of this kind of communication causes modeling to be devalued by everyone else.

What you don’t know

Data changes rapidly – weekly, daily, hourly. Some of today’s data could be inaccurate. We may not know that until tomorrow’s data arrives, or a sensor fails.

Consider hurricanes. Hurricane models “predict” their path & severity. The output changes as variables are added /changed / deleted, and as varialbe importance changes. As the hurricane gets closer to shore (or as the time to make your third round draft pick nears), models become more accurate because there are fewer variables, & the possible range of still-useful variables shrinks.

What don’t we know?

When Donald Rumsfeld was Secretary of Defense, he was asked about then-recent discoveries about WMDs in Iraq. The questions were legitimate as was his answer, though he was mocked for it at the time.

“Reports that say that something hasn’t happened are always interesting to me, because as we know, there are known knowns; there are things we know we know. We also know there are known unknowns; that is to say we know there are some things we do not know. But there are also unknown unknowns—the ones we don’t know we don’t know. And if one looks throughout the history of our country and other free countries, it is the latter category that tend to be the difficult ones.”

Donald Rumsfeld (2002), speaking as U.S. Secretary of Defense

Anyone who has worked with business metrics, science, or fantasy football knows that he was right.

Despite this variability & the knowledge that tomorrow could look much different, we often have to make decisions using today’s data.

Predicting people performance

If you’re trying to predict the performance of a NFL player, it’s equally difficult. We know a player has a 44″ vertical, runs a 4.2 second 40 yard dash, and is a three year All-Star (and more), yet we still can’t accurately predict his stats for next game.

We don’t know that his mother is sick, or that a tiny injury is bothering him intermittently. We might not notice tiny performance differences that affect a game’s outcome. Perhaps only the player who covers him will notice.

After the game, the coach might tell the press that they called different plays “because he’s hurting a little bit” as a ploy to distract their next opponent. It’s Rumsfeld’s “unknown unknown” to most of us.

You don’t know when you draft a great quarterback that you’ll lose him for the season in week seven because he tripped over his own feet during practice. Likewise, if you don’t know your best salesperson’s mother has terminal cancer, you won’t know that (or how) it affects their work.

Will models help you?

How’s your team? Is anyone challenged by something that impacts them like a nagging injury? How distracted would you be in that situation? What would help you? What needs do your people have that they don’t normally have? How can you help? Can they help each other?

What aspects of your clients’ performance could be predictive? What data is indicative of their performance? What *was* indicative but has changed? What don’t you know? Have you checked in with them? How can you help? Can they help each other?

Can performance modeling help you see performance changes earlier? Can models help you make better decisions earlier?

What don’t you know?

Categories
customer retention Customer service Employee Training Getting new customers Management

Got a reopening plan?

As economies start to reopen (like ours here in Montana), everyone’s trying to figure things out. What’s going to be different? What’s going to be the same? What should we do & say? One of the most important aspects of your reopening is the communication to your employees and to the public – your customers.

Employees need a roadmap

Training is essential. Make sure they know specifically what new tasks are expected of them, when, how often, & why. Don’t assume they know exactly what to do. Document new processes. Advise about old processes that are gone. Observe how these processes are executed. Let the best ones train & observe the rest so you can deal with more important things.

Yes, management 101.

Explain the impact of these things on your customers. Their actions, or inaction, could make a client for life, or repel someone forever.

They need to understand what’s being done to keep them safe. Employees need certainty. Their family needs to know their health & income aren’t being placed at risk.

Customers decide

I mentioned employees first because if they aren’t prepared, your customers will notice. They’ll watch how your business responds. Most people know someone somewhere who has gotten sick. Some are scared (or at least concerned), and some aren’t.

The busier your business was, the easier it’ll be to avoid. You may need to meet your customers where they are – just like always.

Make sure your customers know exactly what you’ve done to make your business safer for them. They need to know exactly what you’re doing each day. If they see things indicating that you don’t care about your people, why wouldn’t they assume you feel the same about them?

Make sure they understand what the new rules are, whatever that means for your business.

The logistics of all this are not easy. It’s probably work you haven’t been doing, at least not at the scale reopening requires.

Your customers need certainty. They decide whether when (or if) they return to your business. Your actions, people, & communication will impact their choice.

Customer experiences

I ordered carryout pizza from a place that brags on their contactless carryout. I arrive to find employees without masks or gloves. The same pen & clipboard is used for every other pick up I watch while waiting in the car for my order. I get the same clipboard & pen to sign with, despite the fact that I paid online. Keep in mind that the employee delivering the pizza and handing over the clipboard/pen is touching the same items that every customer touches. When I touch the pen, I touch everyone else who touched the pen.

A week later, I order carry out from a local pizza place. They’re sharing pens/clipboards & requiring signatures for an online payment. There’s no PPE.

A week later (you’ll notice a pattern here), I order carryout from a different national pizza chain bragging about contactless carryout. Same deal. No PPE and a shared pen / clipboard.

A few weeks later, I used the drive through at the third place. After speaking with their national office a week earlier, their contactless carryout truly is.

I had allergy testing scheduled for a while and surprisingly, it didn’t get cancelled. Everyone masked up – even the receptionist. When I arrived, they had a clean pen jar & a used pen jar. A sign instructed you to use a clean pen and place it in the used pen jar when done.

At grocery stores, there are signs identifying sanitized carts. The clerk wiped the pinpad after the person in front of me was done – a process that didn’t happen two weeks earlier.

I placed an online pickup order at a brewery. When it was ready, I received a text message. When I arrived, it was ready to carry to the car.

I haven’t heard from the other two “we’re contactless but not really” pizza places.

Reopening Processes

What processes had to be changed? Don’t force your team or your customers to figure it out during their first encounter with your reopened business. It’ll frustrate them & make you look unprepared.

If signs will help, make signs. If a sequence of signs will help, or a checklist will help, use them. Warn your customers in advance of any orders and repeat the advisory when they place an order. Let them know what to expect. If your new process needs explanation (regardless of reason), explain it.

Photo by Birgith Roosipuu on Unsplash

Categories
Customer relationships customer retention

Remember the feeling

Lots of folks out there are concerned about their customers. Some… for the first time in years, having taken them for granted for a while – perhaps from day one. If your behavior toward clients has noticeably changed in the last month, ask yourself why. How does it feel to find yourself scrambling to keep those clients?

Remember the feeling.

Do you get the idea that everyone knows you’re trying to save yourself? Have you experienced difficulty gaining their trust? Do they believe you’re really thinking about them for them? If that hurts, or if it bothers you…

Remember the feeling.

The next time something like this happens, will you have to rethink how you care for your customers, or will you already be in the right place with your clientele?

Remember the feeling.

Likewise, if you’ve noticed that your vendors are acting different… If they seem interested in your concerns in ways you haven’t seen in a while…

Remember the feeling.

When the phone rings and you see a name on the caller ID, do you mute them or roll your eyes? Consider whether your customers feel the same way about you.

Remember the feeling…

Even if you don’t, they will.

Photo by Atlas Green on Unsplash

Categories
Employee Training Employees Leadership Small Business

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
Creativity Employees Entrepreneurs Management

Adapt to build security, stability, & certainty

A lot of the concern you see from people right now is rooted in a loss of certainty. Ask a few business owners why they started their business and you’ll likely find security, certainty, or the desire to have more control as their reasons for starting a business. Maybe it’s the feeling that they finally have some security (or an increase in security) thanks to making some extra cash each month. It could be based on having the ability to “take a punch”, ie: withstand an unexpected week away from work, or some other temporary negative impact on your income.

Stability and security

For a business owner, one of the first steps in this path is being able to pay yourself consistently. For some, it was the ability to make payroll without nervously waiting on sales to come in before the end of the payroll period. Perhaps it was the ability to offer your team the benefits they’d expect at a larger employer. All of these are steps along the path to sleeping better at night as business owner, and at some point, as an employer.

Your employees crave the same type of stability, security, and certainty in their lives. For the employee, stability means knowing you’ll have work for the next couple of months. Having retained earnings available feels pretty good right now if you’re an employer. Perhaps you can assure their future for the next few months. Or maybe you’re as worried as they are.

Now is a great time to discuss ideas they’ve had that you might not have had time for. A weak owner with little vision will simply lay them off without any effort to find an interim solution.

If your business is slow, your sales and marketing efforts need stronger efforts. For those who never had to sell before (some businesses don’t), you might have to start. You might have to “beat the bushes”.

Some of you may never have needed to do marketing before. Others can’t survive without it. Adapting means you might have to do some things you’ve never done before. How we adapt to change says a lot about us.

What adaptation looks like

Adaptation takes many forms. A high-end, upscale, highly-regarded restaurant in Seattle closed a week or two ago, but not for good. They decided it wasn’t responsible to be a gathering place for a while. It’s possible that they may have had no choice in the matter if their clientele stayed away for a few months.

Rather than let fate, luck, or circumstances determine their destiny, they took things by the reins. Their current solution is to create three businesses. One, a food truck type of business for simple breakfasts (coffee and bagels) and another food truck type business that serves lunch. Finally, they created a service that creates family dinners to carry out and take home (to go only, no on-site service).

Once things return to normal, they might leave those three new businesses open and reopen their fancy restaurant. In the meantime, they’ve kept their people working while providing food services that some people need.

Create new certainty

These are the kind of ideas worth discussing at your office or shop. As an example, if you provide raw materials (whatever that means) for certain clients, perhaps those clients could use assemblies or packaging of your raw materials (including delivery) in a form that allows their team to work at home in their garage to build / assemble / etc the same things they build at their shop. This type of idea may not fit your business, or your clients’ business, but an adaptation might. Rethink about what you do, what they buy & how you can help them.

Think about every step in your process & theirs. How are you involved now? How can you shortcut the process or provide partial results along the way? Brainstorm possibilities with them. You might find solutions that make sense for both parties under today’s conditions. They might also fit afterward. Even if they don’t, the solution have value to others.

Can-do thinking that built resilient companies in the past & can do so again. Leaders step up when the time is right. They don’t wait. They don’t need permission. They just lead.

Photo by Balaji Malliswamy on Unsplash

Categories
Leadership Management

Be Prepared on Main St.

If you believe the folks randomly interviewed on the news, it doesn’t seem like anyone’s too worried about COVID-19 here in Montana. How they shop tells a different story: people want to be prepared. I recently found the TP section of Wal-Mart all but empty. Costco was out of TP except for the big public restrooms rolls. Same for the 20 pound bags of rice (Costco-wise). I mention this because ignoring the need to “Be Prepared” (the Boy Scout Motto) isn’t advisable in your business life any more than in your personal life – even if you weren’t a Scout. To that end, a friend sent me a link to a founder/CEO advisory sent by the Silicon Valley venture capitalist firm Sequoia Capital. Print readers, see https://medium.com/sequoia-capital/coronavirus-the-black-swan-of-2020-7c72bdeb9753

The Sequoia advisory was aimed at founders and CEOs of firms they’ve invested in, yet they kindly shared it with everyone. They called it (paraphrased) “guidance… while dealing with potential business consequences of the spreading effects…“.

If you read it, bear in mind that it’s targeted at founders and CEOs at startups, not necessarily at Main Street businesses. Still, much of the guidance applies to local business, so I used a little editorial license to adjust their guidance for Main Street.

Challenges being faced

They listed drop in business activity (sales), supply chain disruptions, curtailment of travel, time to containment, recovery time for the economy after containment. All of these things could impact Main Street. For non-tech businesses, the supply chain is the one that concerns me. Stay on top of this if you depend on Just-In-Time suppliers.

Cash runway – Most Main Street businesses don’t have a Silicon Valley style runway. They have receivables & payables and the only investor is often the owner. If you have a line of credit to smooth out the bumps, have a cup of coffee with your banker. No one likes surprises – and that goes for both of you. Two-way communication is critical.

Fundraising – Few Main Street businesses are concerned about raising another round of capital, but the thought of forging partnerships during difficult times is wise, even on Main Street. As the advisory noted, “Constraints focus the mind and provide fertile ground for creativity.

Sales forecasts – While this paragraph is brief, it’s important. Customers may delay payments because they’re being paid slowly. Be prepared, communicate often, assume nothing.

Marketing – While I agree that care is needed (where the advisory says “rein in customer acquisition spending” and “raise the bar on ROI for marketing spend“), events like this cause some companies to freeze. Fear has them not marketing as hard (or worse, not at all). Fear-induced contraction can become self-fulfilling, causing business to soften because they took their foot off the gas. Even if your spending is curtailed, don’t stop marketing altogether. If you invest carefully, you could pick up some business you might not otherwise have gained.

Headcount – While it’s just slang, I detest this word and its cousin “Human Capital”. As if we’re thinking “Hey Buck, back that skid of human capital up to the loading dock, will ya?“. Let’s take a different angle at this. Your people are going to be scared, or at least, worried. They’re worried that you might cut their hours, or cut them loose entirely, much less that the business might fail. People don’t respond well to surprises. Communicate early & often. If you have an emergency fund or cash buffer that has you ready to make payroll despite a bumpy three or four months, tell them sooner rather than later. Their concern will impact their behavior. You don’t want that.

If it starts to look like making payroll could be tough a month from now, don’t wait to tell them. I know, I know, you don’t want to lose them, so communicate carefully and honestly. Be flexible & creative. Find a win-win to help them stay that helps you both, even if part-time. When things get rolling again, you don’t want to be the business who can’t hit cruising speed due to an inexperienced staff.

Capital Spending – As Sequoia noted, keep your powder dry.

Leadership – They hit this for a couple of paragraphs because it’s important. Depending on how things go over the next few months, your checkbook and your leadership could be tested. Your actions will send a message to your entire community.

Photo by cheng feng on Unsplash

Categories
Customer relationships Employees Entrepreneurs

A hero always has work

We talked last week about getting started and that one of the challenges of getting started is what to do first. Sometimes, knowing who you’re going to serve makes it easier to decide what to do next (Remember: “next” doesn’t mean forever). A good question I heard years ago that’s useful for narrowing your focus and providing some direction in this respect is “Who do you want to be a hero to?” That’s an important question because it does a nice job of narrowing down the possibilities of the work that you’re considering. It also reminds you of your “reason why”, ie: what fuels the personal satisfaction that you get from helping the people that you eventually become a hero. Still, not everyone can relate to the hero thing.

”I’m not a hero”

You might not think you can be a hero, but I suspect that’s because you’re thinking of heroism in the context of a mythical superhero with superpowers, or of a real hero, like a firefighter who risks their life to enter a burning building to rescue someone who’s trapped.

There are other ways to be a hero.

Ever been disappointed by a vendor? Then you know that a vendor that a customer can always, always, always depend on is a hero.

Ever had a consultant who was there every time you desperately needed them? You know what a hero does.

Ever had an insurance agent help you navigate a maze on one of the worst days of your life? You know what a hero does.

Ever had a manager you could always depend on? Who always had your back? You know what a hero does.

Every business has work for heroes.

Who are you a hero to?

Spending time working with the people you want to be a hero to helps confirm you’re in the right market. It can also tell you your market is exceedingly difficult to break into.

Sometimes that’s because the market’s already crowded or the people you want to be a hero to are difficult to serve. Maybe they’re of a one off nature, so it’s hard to build a good economic model from that sort of solution. That doesn’t mean give up on that solution, but it may indicate you’ll need to be more inventive, clever (etc) than you might have expected.

This may mean that you have to spend more time with the people in your target market, which frankly is always beneficial, even if you’re going in the wrong direction. While working directly with the customer you want to be a hero to, you are going to learn much faster. If you’re just starting out, then it makes sense to try the first thing that catches your eye. You’ve got plenty of time. Your very first “real” job may not have anything to do with a career and career path you end up on – and that’s OK.

Change canoes to be a hero

Likewise, just because you’re 55 or 65 and have been a CPA for decades doesn’t mean that you can’t decide to be a fly fishing guide. If you’ve got the skills, and you have the heart and mind of a teacher, and you’re willing to do some marketing and networking, then you can probably do it. What matters is that you want to do it badly enough to not let that desire sit unused on the shelf.

I saw this in a young man for a better part of a decade. He was doing well in a job that he didn’t necessarily like, and was advancing in a company that didn’t appear to have much respect or empathy for their people. It didn’t seem that they cared about their employees as much as they should have.

A decade of percolation on the thought of “what interests me” finally came to a head, and when the time was right, he made a choice. He’s since narrowed that choice and is focused on being a hero to “his people”. That’s kind of how it works for all of us whether you’re 25 or 65.

Life puts opportunities in front of us. More often than not, the key is stepping out of our comfort zone long enough to grab the opportunity to be a hero to someone.

P.S. Everyone has at least one hero story. 5 or so years ago, the owner of a company was going to send a handful of people to a very large client, perhaps their largest. This Fortune 10 company was not to be messed around with. You wanted your best people “on the field” at this place.

At the owner’s request, I suggested a few people for the trip. One of the suggestions provoked an “Are you sure???” response from the owner. I told him “This guy is going to show up in a suit, be incredibly polite, take notes, ask good questions and will never embarrass us.” The owner was surprised. He didn’t see that side of this guy (and this wasn’t a suit-wearing company), but I’d seen this guy on the playing field in the past. As expected, he did exactly as I described.

At the very least, heroes do what’s expected of them, even when no one’s looking. It matters to them, even if it doesn’t matter to you.

Photo by tom coe on Unsplash