One Bad Apple

In college basketball there are players known as being, “one-and-done,” as in playing one year for the college team and then going off to the NBA (because of rules preventing them from going to the NBA straight out of high school).

As a casual fan, I’ve come to appreciate the job certain coaches do with these players (aka prima donnas), not to mention their parents. Most of these players don’t want to be in college, it’s only a steppingstone, and often they tend to be culture disrupters. This appreciation comes from seeing all the other teams where these one-and-done players cause the team to underperform.

It’s just like in business, isn’t it? You strive to build a culture for growth, profits, advancement, and an enjoyable workplace and yet one person can damage, if not destroy, this. In an owner group I’m in I’ve heard about employees who:

  • Refuse to cooperate with others, it’s their way or no way.
  • Exhibit inappropriate behavior, sexist (sexual) in nature.
  • Bully co-workers.
  • Leverage special-class status (threatening that any action towards the employee would result in a legal action based on said status).

The above and other situations are why there’s constant interest from owners and managers on culture, employee relationships, managing all the HR regulations, etc. It’s a balancing act whether you manage single digits of people or hundreds. Unfortunately, there’s no easy, quick-fix solution; it takes patience and skill.

“Anything can happen, but it usually doesn’t.” (Humorist) Robert Benchley 

Your Business is Really a Community

I wrote this in Antigua, West Indies on another Rotary service project installing computers and Wi-Fi networks in schools, training teachers how to teach more effectively, with and without technology, and setting up our eighth sewing center.

As we were organizing the latest sewing center it really hit me how big community is on the island. While US cities from New York, to Seattle, to many others have neighborhoods and those neighborhoods have organizations, in Antigua it just seems they are tighter.

Main reasons for this are many people don’t have cars, they often stay in the area they were born, and so very much of their lives center around church (many, many types of churches, most of them small given the lack of mobility). They help each other on a regular basis. Ladies we would not consider to be “well off” sew clothes for those less fortunate because they care.

Think about this in regard to your business (or, for advisors, your client’s businesses). Community is like teams within a business. Most business buyers I meet tell me they are good at team building. Given a business is its people, both employees and customers, being able to bring employees together for a common goal is incredibly important. 

I recently wrote about our most recent Getting the Deal Done Breakfast Conference and guest speaker Bob Donegan, president of Ivar’s. Ivar’s has employee turnover less than 1/3 the industry average. Why? Because they value their people, give them advancement opportunities, and decision-making authority, especially if there’s an unhappy customer (from management down to maintenance people they can offer unhappy customers remediation). 

In a recent meeting with a roomful of business owners the following was asked, by an owner looking to buy another company, “What do I do first after closing?” The common answer was, talk to your people, ask them what they would do to grow the business, and, above all, listen. Good advice whether after an acquisition or any other time.

“Man’s character is his life.” Heraclitus

Factories and Their People Get Smarter

Fact: Politicians, all politicians, from both parties, promise more jobs, better jobs, increased pay, and anything else they think will garner them votes. 

Fact: None of the politicians have any idea what’s really going on or what to do.

Help wanted is very common

It’s a fact of life these days that a majority of businesses can’t find enough good workers with the emphasis on the word good (as in skilled, competent, will show up for work every day, etc.). Not just in big cities like Seattle but in small towns I’ve been to over the last couple years. Signs abound seeking workers. 

In December 2019 the Wall Street Journal had an article titled, “American Factories Demand White-Collar Education for Blue-Collar Work.” The article summarizes what I regularly see, an increase in advanced machinery, more production with fewer workers, and the need for smarter workers. The article is filled with statistics, which I won’t repeat here, and the bottom line is, from large firms like Honeywell, Caterpillar, and Harley-Davidson to small businesses, more is being done with less, as the following graphs from the article show.

A close up of a map

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Education

My mother was a teacher, many of my parents’ good friends were educators, so I grew up in a culture of education (you can imagine the repercussions when I misbehaved in school, i.e. disrespected a teacher). So it’s no wonder I’ve given a lot back via my Rotary projects in schools.

Want people to have better paying jobs, give them the training and education to get them. A couple years ago we had a speaker at the Bellevue Breakfast Rotary Club whose organization was (is) trying to get our educational system to emulate the European system by getting kids who aren’t going to go to college into a trade program sooner versus later. An alternative to graduating high school with no interest in college and no real job skills. It’s why I admire companies like Dick’s Drive-In and Starbucks that pay for higher education for their workers, even though they may use that education to get a different job.

It’s a technology world

Technology is really what it’s all about. Not just code writing or playing games but knowing how to use technology on the job. The WSJ article states not only has the manufacturing industry dramatically increased the ratio of capital to labor, but they’ve had double-digit growth of jobs requiring “complex problem-solving skills” versus a decline in jobs requiring the least amount (of complex problem-solving skills). In fact, over 40% of manufacturing workers now have a college degree, almost as many as those with a high school diploma or less.

One of the members of my Rotary Club is with a company using technology (artificial intelligence actually) to match people, employers, and careers. When you get people doing what they like (love) they’ll be better employees, change jobs less often, and be more productive. As the WSJ article said, in a quote from a plant manager, “If you want to be one of those people [who want to just punch in and punch out every day], you won’t be successful here.”

Conclusion

This is why I added “Show you can attract and retain great employees” to my list of what business owners should do to make their business more attractive to buyers. It’s why one of the important skills a buyer can have is to be successful at team building. As I often say and have repeatedly written in my newsletters, business buyers aren’t really buying the company, they’re buying the people.

A Great Team Equals Success

We’re in Antigua, West Indies, on our Rotary project, working in the schools. Over the course of the trip I’ve had 12 meetings (in seven business days). They’ve included:

  • Government – meeting the acting Prime Minister, the Board of Education, and the Director of Education (really the COO of the school system), the Minister of Information and Technology, and the Director of Education.
  • Funding – a (great) meeting with our top non-Rotary funding source.
  • Media – appearing on Good Morning Antigua and a morning radio show.
  • Rotary – attending the Rotary Club of Antigua’s meeting.
  • And a few others.

This project is like business, there are partnerships everywhere. In business you have partnerships with customers, employees, suppliers, advisors, and more. In addition to the above Rotary, funding, and government partnerships my Rotary club also partnered with:

  • The Bellevue School District’s technology department, to provide the people to install computers and Wi-Fi networks.
  • Our trainer, who we hire to instruct the teachers on how to more effectively reach their students using technology (lesson plans, exercises, interactive, etc.).

Just like a business, we couldn’t do it in a vacuum. We need all of the above. And the result has been we’ve had an extremely successful trip, probably our most productive.

“We learn from history that we do not learn from history.” Georg W.F. Hagel

More Random Thoughts on Our Crisis

I’ve had a lot of positive comments about my random thoughts format during the crisis, so here are some more.

Every day I get closer to having my wife get the clippers out and give me a buzz cut. I needed a haircut three weeks ago, was debating if it was safe to be in a shop, and then the lockdown.

I’ve seen more than enough emails with links to all the disaster relief programs. I’ll bet I got 20 or more.

I find it really beneficial to not have news radio on during the day because all they talk about is virus related, and not much is new. I can get enough in short bursts in a lot less time.

We walk our dogs almost every day and boy are there a lot of people out walking we’ve never seen walking before. And, on a walking meeting with my friend Pete McDowell we ran into a couple who saw us coming, moved about 25 feet away, and gave us a dirty look for being on the same path they were on.

A lot of helping going on. Just in our family, my wife went to the store for our 85-year-old neighbor. Jessica and she are sewing masks for Evergreen Hospital. Tomorrow I’ll be helping deliver 300 meals the Bellevue Breakfast Rotary Club is buying from Tutta Bella for Overlake Hospital (when we’re done, I’m guessing we’ll provide at least 3,000 meals for health care workers). My younger daughter gave an elderly man at the store two extra masks she has (the store was out of them). I know this is happening in many families.

There’s sure a lot of creativity going into funny videos about the virus. A friend even sent me a YouTube link for a German one titled, “Scheiss Corona” sung to the tune of My Sharona. 

On a serious note, I wrote my State legislator and asked why politics crept into the shutdown policies (I know the answers and I’m not making judgments here). Why was Sound Transit allowed to work for a few weeks, but home remodelers can’t? Rotator cuff and joint replacements for people in pain are out but abortions are essential? Why are pot shops open but gun ranges aren’t? I think it healthier to shoot off a few rounds to relieve stress than get high.

A lot more of us are getting better at Zoom, GoToMeeting, Teams, and other video conferencing services.

People are going to get sick of working from home a lot faster than many “experts” think they will.

Finally, I get asked all the time about when I think the economy will bounce back. Most people are optimistic because we’ve bounced back fast before. Then I see Tom Douglas, Bill Gates, and others writing about how they think it will be a long road to full recovery. I’m guessing it will be somewhere in the middle of the timeline, but really have no idea. I hope the optimistic crowd is correct.

If You’re Going to do Anything, Make an Impact

At a recent meeting of the Bellevue Breakfast Rotary Club, I barely paid attention to 90% of the program. Why? Because in the first few minutes the speakers said a few things that got me thinking (and ignoring most of the rest of their talk). To summarize what they said:

For whatever we do (business, personal, charity, etc.) we need to not consider the actions, the money, or anything else other than the impact we make.

What is the impact we make when we do things? For example, I wrote this while in Antigua, West Indies, on our annual trip to work in the community and schools. Our impact is least five things:

  • We give Bellevue tech students incredible on-the-job training as they setup computer and Wi-Fi networks (and live with local families). 
  • The Antigua teachers are learning to use computers to reach their students more effectively.
  • The students learn via different means (and learn more we hope).
  • We’ve created more accountability (from the adults in government, especially when we we’ve had to cancel projects because they didn’t live up to their obligations).
  • Ladies learn how to sew, improving their economic well-being, increasing their sense of community, and greatly increasing their self-esteem.

What about in other, more day-to-day, scenarios? It’s about the result. In one of my first sales jobs the manager told me to never think about the commission and only think about how I/we were helping the client, i.e. the impact we have on them. Here are some examples close to my business:

  • Whether it’s interactive or by example we should be impacting and improving our family relations and abilities. When Vince Lombardi was coach of the Green Bay Packers, he said to his players their priorities were, “God, family, and the Green Bay Packers.” So I list family before anything work related.
  • As an employee you should be making an impact for the company where you work. They have to benefit (profit, financially, culturally, and community wise) from what you do. If they don’t, why do they have you there.
  • When I help someone buy a business it’s a life-changing event. They are taking control, which is quite an impact on their family and themselves.
  • The same can be said when someone sells a company and moves on to their next great adventure in life. The impact is often phenomenal.
  • Maybe what happens before a sale is more important. If you, me, or anybody else can help someone achieve balance, be more productive in less time, or enjoy life more, it can be a much larger impact than buying, selling, or doing their job better. 

Conclusion

Sales managers (should) tell salespeople to take the necessary actions (calls, meetings, proposals, etc.) and if they do the impact will be helping a customer. Whatever you do should be focused on the impact you make on others and if you do that you’ll make an impact on your own life.

Social versus People Distancing

I’ve read and heard a lot lately about how we’re all social creatures by nature, which makes social distancing tough. My neighbor says we’re people distancing not social distancing.

An he’s right. We’re in touch from six feet away, on Zoom, Teams, FaceTime, and other apps. We’re just not close to each other (which is tough on people who love to hug).

When the Employees Steer the Ship

A company Jessica and I have been helping has a dependency problem, which is not uncommon in small businesses. Unlike most, it’s not the owner and it’s not a customer concentration issue. It’s an employee, specifically the (former) operations manager.

I should say “almost former” because she’s ingrained herself so deep into the operations that she’s still working part-time even after she moved out of state. There are a few things only she can do, and they’re important tasks, some critically important like pricing.

You may ask, “How does this happen?” Just look at some of the causes (at this company and in general):

  • The employee takes over, is controlling, and won’t delegate (just like a founder/owner). This is what happened in my above example.
  • The owner is lazy and may think he’s delegating but he’s really offloading. 
  • The technical aspects of the business are not the owner’s expertise (and don’t often need to be) but the company isn’t large enough to have depth.
  • There’s not cross-training, no team building, and maybe not training in general.

It doesn’t take much effort to have this happen and I can speak from personal experience. Jessica’s been off for a couple days, there are some things I have to do using Salesforce, on which she’s much more accomplished than me, I got some done, and needed to speak with her before finishing.

When things are going well it’s no big deal. But if the employee leaves, gets sick, or is in an accident there’s a problem. It’s just like exit planning. Most owners don’t think of preparing the business for sale or they ignore it until it’s time to sell and then it’s too late. An employee dependency is something that can usually be prevented (or cured) if you pay attention to it.

“Children aren’t happy with nothing to ignore. And that’s what parents are for.” Ogden Nash

Will COVID Change Regulations?

Perusing LinkedIn, emails, Twitter, and other sources I see a lot of commendations for health care workers of all types. The same for the universities, corporate research labs, etc. that are working on tests and vaccines. All deservedly so.

I don’t see too much about how most people, including politicians (if politicians really are people), are united to get things done quickly. In this case, it means circumventing some regulations and attitudes.

Believe me, I’m not anti-regulation. I believe workers need to be protected, I don’t want companies or individuals dumping chemicals in the water, on the land, etc. We need to protect people from themselves with seat belt laws, restricting texting while driving, etc. And yes, regulations can go too far. Did you know when there’s a green box for bike riders at a stop light you can’t (legally) turn right on red? Yep, federal law as told to me by someone at the City of Kirkland when I questioned this.

So it’s great to see some of the labyrinth removed to get vaccines and tests approved. Let’s hope more of the excess regulations go away after all of this.

Has COVID-19 Derailed Your Planning? Tips From a Crisis Management Expert

For most business owners I’m guessing your strategy is off track and any exit planning is on the back burner given our minds are on the ramifications of the COVID-19 virus. What is probably on the minds of many is, “How and when can I get out as I don’t want to rebuild it again?”

It comes down to choices. Here’s one of those choices: 

Is the pain of rebuilding your business greater than the pain of selling at a discount? If it is, once there’s stability it’s time to sell. If the pain of selling at a discount is greater, then do what you can when you can. And depending on your industry, it could be a quick rebound or a long, slow process.

We should all realize there is nothing most of us could or can do when something like this wallops us. Customers can’t buy if your business is (forced to) closed. You can’t make sales calls when ordered not to. But that doesn’t mean you go into hibernation mode.

For tips on how to minimize damage I interviewed my friend Dan Weedin, who is a crisis and disaster management expert (you can see more about Dan at www.danweedin.com). Here are the questions I asked Dan and his insights, followed by a few pieces of information from me:

What were you telling clients 6, 12, and more months ago about crisis planning?

Business owners should create a written business continuity plan that covers who’s in charge of a crisis, what are your continuity paths with employees, customers, suppliers, and the community. Know your emergency preparedness procedures for things like loss of power, loss of water, damage, etc.

What about pandemic preparation?

“This caught me by surprise given it’s been 100 years since we’ve had anything of this magnitude.” He said if he had told clients to prepare for virtually the whole economy shutting down, he feels they would have thought he’d gone crazy. The biggest problem with this situation is the uncertainty as it’s different and scary. With other crisis’s (fire, tornado, flood, etc.) we have an end point, so we deal with it, and recover.

What about recovery?

Be worried about your supply chain. Your area and your firm could be back to work but if your suppliers are in other states or countries and they aren’t back to full speed you’re still treading water. Look at options now.

What are you telling clients now?

First, it’s different than what I would have said a week or two ago. My top things are:

  • Stay educated. There’s a lot of data out there. Know what’s happening with governments and their policies.
  • Employee safety is number one. What can you do to keep them safe?
  • Innovate. What if this is our normal for three months?
  • You can’t over communicate. Communicate to create community.

What are some examples of what businesses are doing?

  • A gym is holding virtual training sessions. They want customers back when they’re allowed to open instead of buying Peloton’s, building fancy in-house gyms, etc.
  • A bar is doing online cocktail making classes as they know they’re customers will remember them and be back.
  • A shared work facility is doing a virtual happy hour to keep front-of-mind.
  • A winery, not able to do tastings, offered their club members free shipping if they added three bottles to their order. They’re delivering the wine so the customers don’t get it at the store.

In the future he will do pandemic training as part of disaster planning and his final words to me were, “Talk about things other than COVID-19 and be a distraction to others.”

I (John) also realize we’re in the middle of something we never thought would happen, much less planned for. So, we have to move forward from where we are. Here’s my advice, most of it good for all times not just during a crisis.

Take care of your employees and customers. They are tied for number one on any list you have. You don’t have a business without your people and those who buy from you. Do what you can to keep your employees, have them come back if you had to let them go, etc. Stay in touch with all customers, even if they’re not buying now.

Be wise with your cash and at the same time work with (take care of) your suppliers. You want them around in the future. If you have a line of credit, consider using it to get cash on your balance sheet.

Do not “hunker down.” Be as large a marketing machine as you can be (as Dan said, you can’t over communicate), especially if you can do it for little or no expense. Use social media, emails, phone calls, etc. Besides regular messages, one thing my company did was send a request to lot of business friends to help a family my wife is assisting. The mom escaped an abusive situation and is trying to get her kids and herself back on their feet. We got some donations of things they need and kept my name in front of people for a great cause. A win-win.