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Are You Meant to be Self Employed?

Sunday, April 22nd, 2012

As an entrepreneur and founder of nine businesses, I have experienced many ups and downs, combined with many successes and a few failures. Along the way, I sought information and advice. There are plenty of people writing books or willing to give advice who have no experience – they are not businesses owners and never have been. There are also plenty of books but the best known business books were often written by executives from big corporations. The methods and techniques that work in big business can be catastrophic for small entrepreneurial businesses. Tony Hsieh, the founder of Zappos, recently cautioned that his book is a story about how he created his company, “it is not a how-to manual for other businesses and if someone tries to duplicate (his) methods in their business, their business will surely fail”.

In order to help the aspiring entrepreneur, I developed a list of questions for prospective new business owners. Bethany Bauer, a successful business owner and MBA student, has an even more detailed list that everyone should ask themselves before starting a business:

1) You want flexibility in your schedule. Yes, everyone wants this. However, to succeed out on your own, you have to understand that being self-employed does not mean a shorter work week – in fact, it usually means a longer day and week. Being self-employed, you make the rules of your schedule, but time not working is time that is not paid. This trade-off is one that you appreciate and are willing to embrace.

2) You want more control over your ideas, your projects and the work that you do. Are you a control freak and a micro-manager? Are you Type A personality? Since an entrepreneurs’ ideas are theirs, the criticism you get is from your clients/customers (positive or negative). In effect, they are your boss.

3) You don’t play well with others. Many entrepreneurs and new business owners are friendly; however, in a work setting, the may take the lead on projects and become “bossy”. In a number of my businesses, I have had several hundred employees but in some of the newer businesses, I made a conscious decision not to grow the business to more than a few full-time employees. I hire freelancers and contractors as needed. Some business owners choose to have no employees or only one employee; that way they don’t have manage or supervise anyone.

4) You have passion for what you do. Whatever you decide to do with your business, you need to have an ability to translate your passion to your customers and clients. The self-employed thrive on an unbridled enthusiasm for their work. Otherwise you will quickly burn out and get discouraged.

5) You are a good listener. Being self-employed does not mean talking about yourself all the time to anyone who will listen – quite the opposite. You need to listen to conversations in your industry, listen carefully to your customers and your clients and become a fantastic analytical thinker. Be able to repeat back to people what they are saying to you and offer solutions to their problems. 6) You are comfortable being a decision maker. When you are your own boss, you can’t pass the buck. You are your brand and your business, and if something goes wrong or there is a complaint, you need to embrace the criticism, make improvements and move on.

7) You have a good support system. Working alone (and often from your home) can be isolating and lonely. Without co-workers, there is no stress-relieving water cooler banter and a group willing to give you an office party on your birthday. This can be very lonely for some people, so it helps to have family and friends who understand this situation and are willing to help. Your support system must embrace your lifestyle and be totally on board, especially when you start doubting yourself. Also, some of the most successful business people who I know have mentor. The founder of Nike refers to his mentor as his “hero”.

8.) You are a disciplined self-starter. You don’t need anyone else to tell you what to do and you always take the initiative. To be self-employed and succeed you must be proactive much more than you are reactive. This requires the ability to effectively manage your time. Non-entrepreneurs think that businesses owners play all day but the reality is that successful entrepreneurs get up early, often work late and most of all, work intensely during normal work hours (and in the evening and on weekends). If you take a day off, screw around, or waste time, youI don’t get paid. It’s as simple as that.

9) You are willing networker. This is the most difficult part for most. People like the shield and protective cover of a group. When you start our own business, you need to be willing to put yourself out on a limb and walk into a room where you don’t know a soul. Attend conferences, workshops, classes, seminars, fundraisers, networking events – by yourself. If you attend many of these types of events, circulate and introduce yourself regularly, then you will see some of the same people and build relationships so that you aren’t out there by yourself as much. Tip: it takes time and requires perseverance to sort through the types of people you will meet at these events until you identify the type of person from whom you can learn. You will find that there are plenty of people at those events who may be in business but they are at the event for the wrong reason and/or they exaggerate their success.

10) You are able to compartmentalize work and private life. This is something I struggle with constantly. Being self-employed means you set your own hours, so you need to be able to do just that – set work hours and hours for family/personal time hours. I want to be available to my clients 24/7, but I also want to spend quality, focused time with my family at the end of the day. Set aside personal time and do not answer emails, reply to a text message or take calls during that time. You should be fully present for your work and fully present for your family – definitely easier said than done, but something that is vital for personal and professional stability.

11) You can let things go. You don’t take things personally and you don’t dwell on things you can’t change. If something from the work day is really upsetting me and I know I can’t have any impact on the outcome, get it out of your system …. have a glass of wine, write an angry blog post or email (and then delete it) and get over it.

12) You can go with the flow. Understand this about self-employment – when it rains it pours, and then there are stretches of drought. Five fabulous clients will call you at once, and then no one will call for weeks. You must be able to adapt and have the ability to balance stressful, busy work periods with slower times. Most importantly, you must plan financially for those peaks and valleys.

13) You are resourceful. As your own boss, you are ultimately responsible for sales, financials, taxes, legal issues, accounting, technology problems, and everything in between. The ability to juggle multiple demands on your time is key for a self-starter.

These are only the initial questions. You also need to be sure about your product or service, finances, marketing and your support system.

Good Luck!

Crisis Management – The Good and the Bad

Wednesday, February 8th, 2012

From time to time we hear the term “crisis management”. In 1982 a number of people in the Chicago area died from cyanide poisoning after taking Tylenol. Along with the police and FBI, Tylenol’s makers launched an immediate investigation and determined that their product was tampered with in several stores. The CEO immediately took to the airwaves notifying Americans of the problem, keeping them informed during the investigation and they pulled all Tylenol products from store shelves. An article in the Washington Post said, “Johnson & Johnson (the maker of Tylenol) has effectively demonstrated how a major business ought to handle a disaster.” In the end, Tylenol introduced new packaging and new safety measures before returning their product to the store shelves. This incident led to new regulations for the packaging of medicine and food products.

On the opposite end of the spectrum is BPs response in 2010 to the oil spill in the Gulf of Mexico. Their CEO took to the airwaves, misled the public, tried to downplay the seriousness of the accident, placed blame on others, and even went so far as to complain about the time that the crisis was taking him away from his planned vacation and weekend sailing. As a result of public response and pressure from BP, the CEO resigned. When reporting on the crisis and BP’s response, CNN reported that “Leadership is, among other things, about projecting an image of being cool under fire, acknowledging where the buck stops, being knowledgeable about the company’s business and being realistically reassuring about the future. People both inside the company and outside need to believe their leader is in charge and in control. This did not happen at BP.” In fact, it took high-level discussions between the US and British governments before BP finally changed their response.

Many Americans and most football fans are aware of a crisis that occurred involving the Pennsylvania State University in November 2011. That crisis involves accusations against a former assistant football coach (Jerry Sandusky) who retired from coaching 13 years earlier. The assistant coach is also the founder of a non-profit organization for troubled youth (The Second Mile). In fact, one of the reasons that head coach Joe Paterno asked the assistant coach to resign was due to the increasing time that Sandusky was committing to his nonprofit and the decreasing time that the assistant coach was committing to his coaching obligations. About four years after his retirement, Sandusky was heard or observed participating in an apparent inappropriate or illegal activity with a young boy in a building on the University campus. There are different versions of what was heard or observed by an assistant coach but it is agreed that the assistant coach waited until the end of the following day to notify his boss, head coach Joe Paterno about what he had heard.

In his testimony before a grand jury, the head coach stated that the accusation as reported to him by the assistant coach in 2002 was vague. On the morning after learning of the accusation, head coach Paterno met with the witness and his superiors, including the athletic director, the vice president in charge of the University Police Department, and the university president. The incident was subsequently reported by the university president to the Board of Trustees.

In November, 2011 as result of the investigation, Sandusky was arrested and charged with multiple counts of molestation of young boys. The retired assistant coach was a Penn State University graduate as well as a long time and nationally recognized assistant football coach. Although he was retired for 13 years, some of the alleged offenses occurred on the University campus and media focused on the University, the football program and the highly respected head coach.

Reports of crimes attract the public’s attention, particularly in this case when the alleged crimes involve children. This article is not about the alleged crime. The allegations are extremely offensive and if true, the retired assistant coach should be prosecuted to the fullest extent of the law. This article is about the two responses to the crisis: the response by Penn State University, and the response by Joe Paterno, the recently deceased former head coach.

The University’s Board of Trustees made a knee-jerk reaction in November 2011, a couple of days after Sandusky’s arrest was announced by the media. The University did not conduct an investigation and they did not even hire a crisis management advisor until months later. The crisis was not a football matter but it was a matter involving a former university employee who allegedly committed crimes against children with some of those crimes being alleged to have occurred on the University campus. The Grand Jury interviewed many people concerning the allegations. In their findings, the Grand Jury recommended that charges be brought against Sandusky. They also noted that there were many people who could have taken additional actions when they heard of the allegations including head coach Paterno, other assistant coaches, other university employees, the athletic director, the vice president in charge of the University Police Department, the university president, and others not affiliated with the University. In their panic, the university trustees chose to give-in to media pressure and they made it a football problem when they responded by firing head coach Paterno, a 61 year employee of the University. The University continued to experience intense media attention and waited a month before hiring a crisis management firm to advise the University on how to respond to the crisis.

The second response to the Penn State University crisis was a response by Joe Paterno. Paterno had a lifelong commitment to teaching his students to become honorable adults. For 61 years he was a coach of a major university sports program that did not have one accusation of improprieties by the NCAA. He not only set academic and behavioral standards that far exceeded those of the NCAA, but he recommended changes and served on committees that formulated rules and regulations. Phil Knight, the renowned and sometimes controversial CEO of Nike stated that he has always needed a mentor and hero in his life. Up until 12 years ago his mentor and hero was his University coach and the cofounder of Nike. When his hero passed away 12 years ago, he told (not asked) Joe Paterno that he was Knight’s new hero and mentor, a position that Paterno held until he passed away on January 22, 2012.

In a society that is often confused about the definition of accountability, Paterno was truly an accountable person. He took responsibility rather than placing blame. When the problem occurred, rather than asking who created the problem, he asked how it can be corrected and what can be done in the future to prevent that problem from ever occurring again. When Paterno was interviewed by the Grand Jury regarding the accusation against Sandusky, he concluded his remarks by stating that “in hindsight, I wish I had done more”. Those who do not understand accountability may look at those remarks as some sort of admission of guilt. Rather, it was a reflection by a person of integrity who was deeply hurt by knowing that any child was assaulted, regardless of whether the person who committed the crimes was a former university employee or not. Paterno made those same remarks a second time in a brief speech after being fired by the University. Again, his response was misunderstood as the media tried to interpret that statement as an indication that Paterno should take responsibility for Sandusky’s alleged crimes.

Although he was a longtime employee of the University, the winningest college football coach of all time, and the coach of national championship teams, Paterno was also the lowest paid major university coach of any national championship team. Paterno’s replacement has never been a head coach and the new coach’s pay is more than 250% of Paterno’s salary. Paterno told the University that he didn’t need a lot of money and they should give the additional money to students for scholarships. In fact, Paterno and his wife contributed more than $4 million to the University and their libraries and even in the months after being fired as a university employee, Paterno donated more than $200,000 to the University. Paterno was not part of the University management team, he was only an employee. He did what was required of him by advising his superior, the athletic director. In addition he notified the vice president in charge of the police department and the president of the University. During the Tylenol crisis, the middle manager who first became aware of the death of someone after they took Tylenol notified their manager who then notified the Tylenol executives. The executive team made the correct response by contacting the police who were already aware of the deaths. Perhaps Paterno should have checked back with senior management at the University to see what actions were being taken. Perhaps he should have notified the police of the accusation instead of notifying his superiors and their superiors. The three things that Paterno did correctly in response to the crisis were to first, state that in hindsight he wished that he would’ve done more; second, he asked the students to stop rioting, which some did in response to his firing; and third, Paterno asked the students, the administration and all of the Penn State alumni to pray for and support the victims.

Update: The chair and vice-chair of the Penn State Board of Trustees stepped down in January, 2012. The new chair stated that the matter involving the University reaction to the charges against Sandusky was mishandled and she pledged that the University will correct the matter with Joe Paterno. Paterno died from complications due to lung cancer, less than one week later. As a result of alumni pressure, item “H” was added to the agenda for the annual meeting of the Board of Trustees in January, 2012. A vote for item “H” would have been a vote of no confidence for the Board of Trustees. The vote failed; however, the Board promised to meet with administration and alumni to review the matter. Penn State University has the largest alumni association of any college or university in the United States.

Note: Kevin Miles met with Joe Paterno on several occasions. He is not an alumni or an employee of Penn State University. While this is my opinion, I acknowledge and respect that there are other opinions. It would be good for those with an opinion to withhold judgment until they read the full reports and the Grand Judy transcripts. While the media can sometimes blur the focus and alter public opinion, let’s not loose sight that retired assistant coach Sandusky is accused of having committed those crimes alone and without the knowledge of others. Please keep the victims in your thoughts and prayers.

Embrace Shades of Grey

Monday, July 18th, 2011

If you have ever overacted, you are not alone; however, you should recognize that one of the worst human tendencies is to overreact. Too often, our politicians overreact to a single transgression with a new law, rule, or regulation. Over the weekend, my wife joked about having to show ID when buying an alcoholic beverage. The waiter apologized and explained the restaurant policy of checking all customer IDs, as a result of a lawsuit by an intoxicated underage patron. It did not matter that the under aged patron used a fake ID, nor does it matter that 99% of the restaurant customers are 40+. All customers must provide ID. The people intent on cheating will still get fake IDs.

Although law makers and some jurists would have you believe otherwise, judgment and accountability cannot be replaced by laws and “zero tolerance” policies. It’s silly to suspend a 7-year-old from school for taking a nail clipper (with a nail file) to school, and it’s silly for us to run our businesses as if the world is black and white and subject to clear lines of demarcation.

A business, for which I provide training programs, recently developed a new employee manual. Their attorney reviewed the manual for conformance with applicable employment laws but recommended against an employee manual for two reasons. From a legal perspective, the attorney stated that an employer can inadvertently give up certain rights that may not be considered when the manual is being developed. From a practical perspective, the attorney advised that a manual can force a manager to classify an employee mistake or discretion as black or white, and may force the employer to make a decision that is not in the best interest of the businesses or the employee. Although I am not against employee manuals, businesses must be clear on the information that they are trying to present in the manual. All too often, employee manuals are used as a tool to enforce policies and to punish or terminate employees. The world is full of shades of grey, requiring judgment and, very often, toleration and forgiveness. Employee manuals, rules, regulations and reactive laws can prevent that from happening.

The most successful and profitable business with which I worked over the past 25+ years thrives in shades of gray. Their employee manual was developed to provide clarity and so all employees can provide consistent and superb service to all customers. The manual does not list rules, regulations or employee punishment guidelines. The CEO communicates a vision to work toward and parameters to work within. There are few rules. The business has grown from 20 to more than 1,000 employees, has enjoyed double digit revenue and net income growth for more than 20 consecutive years and has been named one of the best places to work – all because they like shades of grey.


Independence Day

Sunday, July 3rd, 2011

I always find it surprising when I speak with a fellow American who does not know the actual meaning of the Fourth of July holiday.

Yesterday, I passed a park in South Carolina in which families were picnicking and barbecuing. The scene is probably the same on most summer weekends but this felt a little different as many had flags as well as red, white and blue tablecloths and plates. When we think of the Fourth of July, most think of the picnics, vacations and fireworks. My wife began looking at the fireworks schedule three weeks ago in an effort to find the best fireworks to watch. This year, we are going to a peach festival that will be followed by a fireworks display.

The commercialism of holidays is OK, as long as we remember the reason for the holiday. The Fourth of July is Independence Day. Independence is the reason that my mother’s ancestors came to this country in the 1600’s and the reason that my father’s family came to America in the 1800’s. It is the reason that so many people continue to immigrate to America today. Unfortunately, it is also a reason that terrorists and extremists hate our country but we’ll save that topic for another day.

As a young student I enjoyed learning about history but I was not a history buff. My passion was math and science. As I finished school, met people from around the world, and traveled, my interest in history increased. I wish that I studied history a bit more and I wish my parents took us to even more historic places. I hear this common.

And so, on this Independence Day weekend, I think about the history of our great nation. Growing up relatively close to Gettysburg, PA, I took the historic relevance of Gettysburg for granted. It was said that “the hallowed grounds of Gettysburg reveal the soul of this nation”.

Most people know of Abraham Lincoln’s Gettysburg address but just in case you do not know the background, I offer the following. It was July 1, 1863 when the Confederate forces approached Gettysburg with the intention of winning the war. In that small Pennsylvania town, the most important battle of the Civil War took place when more than 170,000 soldiers, 70,000 horses and 550 canons converged. The battle ended on July 3, with the Union Army stopping the Confederate Army, on Cemetery Ridge.

About four months later, President Lincoln visited Gettysburg to dedicate the Soldier’s National Cemetery. Lincoln was not the keynote speaker. Edward Everett, a politician, was the main speaker. Most American’s don’t know much about Everett and don’t know a word of his two hour speech. Lincoln spoke after Everett and with a two minute speech, containing 272 words that began “Four Score and seven years ago…”. President Lincoln set out to clam a nation and declare that those who had died had not died in vain, as he declared the notion of equality.

On this Fourth of July weekend, I wish all a happy Independence Day and recommend that you take a few minutes on this holiday, and all holidays, to consider the history and the reason behind the holiday. Also, if you have not had the opportunity, I recommend a visit to the Gettysburg National Military Park and the Gettysburg Battlegrounds as a place that everyone should visit. This is the 150th Anniversary of the Battle of Gettysburg. As you visit the battlegrounds and the original civil war homes and buildings, you will be awe inspired.

Happy Holiday!


Airplanes Aren’t Made for People: And Other Unspoken but Relevant Truths

Friday, April 1st, 2011

Do you travel much? A friend, Alan Weiss, became frustrated during a recent flight to Europe. Consider this:

I’m sitting in the front of an Airbus A340, and I’m wondering why what I’ve been through is so strange. The plane carries 240 people, but we all go through the same bottleneck, one by one (blaah, blaah, blaah) to get on board.

Planes should really allow people to board through the entire side, so that everyone can get on in three minutes. But the new A380s, which can carry 800 people when configured completely for steerage, will have the same bovine boarding. Who thought this was the way to do it?

When we land, we walk a good half-mile or more, through winding corridors, to reach immigration. Here, at least, they have a multitude of stations, but still huge backups for those without special lines. Then we have to walk another hundred yards and take two elevators to reach the lot where the limo is parked.

The trouble is that airplanes were not built for passengers and neither were airports. Airframe designers, municipal engineers, and immigration officials don’t care about passenger comfort, they care about their own needs and avoiding litigation. How is “Let them walk a mile so that we save building costs” different from “Let them eat cake so we can save the best for ourselves”? (The “cake” to which the lady referred, was actually bread.)

Some years ago, an executive at Ford, appalled when she found she couldn’t gracefully get into one of her own new car designs, ordered her male design team to wear skits during business hours. She told them if they didn’t improve access for women, she’d also put them in heels. The design improved quite rapidly.

What if consumers, clients, customers and all other relevant alliterative categories were involved in the design of the structures, procedures, and processes they’d be using most often? Would the doctor still press a cold stethoscope to your chest? Would you wear those humiliating hospital gowns? Would the division of motor vehicles make you take a ticket and wait around for three hours? Would subway cars have the same kind of seating?

I doubt it.

I try to design experiences that my clients find attractive and compelling, which is not hard when you ask them. Why isn’t that a universal endeavor for all businesses?