The idea of driving aimlessly seems glamorous in movies and songs. In reality, few of us get in a car without knowing how to reach our destination. We’ve created smartphone apps, GPS devices and satellite mapping to make our trips as efficient as possible and to avoid what we know to be an inconvenient, expensive outcome — getting lost.
I bring up this idea because many companies using social media have inadvertently become lost drivers. They start using social platforms with the goal of reaching some number of likes, retweets or shares, but as they embark on their social media strategies, many experience a disconnect between the content they post, blog and tweet and their progress on measurable business goals. These companies are driving without a roadmap; they just don’t know it.
Sound familiar? If social media isn’t working for you, your social media approaches may be missing a fundamental component: an effective content strategy. Here are three ways a solid content strategy will enhance your company’s social media success.
A like is just a like
All social media engagement is not created equally. To be successful, the social media activity that you generate needs to support your marketing goals — whether you want to improve employee engagement, boost customer conversions or build interest in a new product.
Creating a content strategy before you engage in social media will help your business clarify the specific marketing goals you want to achieve through content, as well as what messages you need to communicate to reach those goals. This process will ensure you get the right likes, shares and retweets from social interactions.
Social is a vehicle
Social media is a vehicle for sharing compelling content with your audience, and it doesn’t work if you don’t know what issues, topics and trends your audience finds compelling. Part of developing a content strategy involves learning how those you are trying to reach want to be talked to. Where do they go for information? How much time do they spend online? What kind of content are they looking for from your industry?
By getting to know the interests and pain points of your audience (customers, employees, shareholders, etc.), you can develop tactics to reach your online audience more effectively, saving you time and enhancing your company’s social influence.
Relevant content is meaningful
Kings of social content don’t become that way by luck. They use strategic tactics to connect with their audience through the right channels at the right times. More importantly, they make these connections meaningful and memorable by posting and sharing strategic, relevant content that their audiences desire.
When you deliver social content that your audience members find valuable or interesting, they’ll reward you by sharing your content, engaging with your business and, ideally, helping to promote your reputation as a thought leader in your business or industry. A content strategy allows you to do that by providing a roadmap for what kinds of informative, helpful, educational or creative content you need to make meaningful interactions.
As a recent Huffington Post article put it, the golden rule of the web is clear: “To know us better is to sell us better.” Ultimately, being successful in the social media space means taking the time to map out what success looks like. In this sense, a solid content strategy is not only an important component of any social media strategy, it’s the key to driving the results your business wants.
Michael Marzec is chief strategy officer of Smart Business and SBN Interactive. Reach him at email@example.com or (440) 250-7078.
Every Company is a Media Company. It’s a phrase coined some eight years ago by tech journalist Tom Foremski to describe the impact of technology on marketing.
From the Internet to Wi-Fi to smartphones, a tectonic shift has taken place with technology forever changing the landscape of marketing, just as radio and television did before.
Only this time, it’s different. This time, the power has shifted from the hands of a few hundred powerful media outlets to the hands of billions of consumers.
At the same time, companies like yours have been handed powerful tools and an unparalleled opportunity to engage with customers like never before. It’s not just in the obvious new places like mobile websites, apps and the media. Technology has made it easier and cheaper to communicate through video, live events and, yes, even print publications.
Like it or not, you are a media company.
So what’s a media mogul like you to do? You need to do one thing: create content. And you need to do it well. You need to create content that generates interest among your target customer base and engages them with your organization.
It might sound easy, but it’s not. Most business leaders know that effective communication is one of the biggest challenges any company faces. When that communication is what sets you apart in the minds of your customers and prospects, the stakes are all the higher.
Here are a few important points to keep in mind as you set about embracing your new role as a media company.
Be where your audience is
Content comes in many forms. Most of us 40- or 50-something business executives are more comfortable reading printed material. Flipping through your brochure, newsletter or even your own custom magazine is comfortable for us. So hand us something.
But younger VPs and 20-somethings — many of whom do the heavy lifting of researching company buying decisions — are more comfortable gaining intel online. They scour videos on YouTube, mine infographics on visual.ly and peruse PowerPoints on SlideShare. So take the time to figure out which of these is the right channel to reach your target customer.
Share knowledge, not platitudes
Yeah, we get it. Your people are smarter, their customer service is better and their breath smells fresher longer. But that’s not why we might be interested in your business.
What we want to know is how you’re going to solve our problems and make our lives easier. We don’t want you to tell us you are smarter; we want you to show us you are smarter.
Thought leadership articles, white papers and blog posts showcase your knowledge of industries, issues and tactics. They differentiate you from your competitors and position you as a subject matter expert in your market.
Talk about customers more than yourself
The best communicators are great storytellers. Stories resonate. They connect us. They are, simply, what we remember.
Sharing client success stories is one of the best ways to tell your own story. The tried-and-true case study is one of the most effective forms of content in a marketer’s arsenal. If you show us how you can make our businesses faster, better, stronger, we will do business with you. It’s that simple.
And if you have particularly well known and respected clients, you get the added benefit of basking in their reflected glory. Welcome to the media business. Now go tell your story.
Michael Marzec is chief strategy officer of Smart Business Network and SBN Interactive. Reach him at firstname.lastname@example.org or (440) 250-7078.
Five years after unveiling its SLR McLaren concept at the North American International Auto Show in Detroit, Mercedes-Benz debuted the real thing at this year’s show in January.
The stunning two-seater showcases the experience of Mercedes-Benz and its Formula One partner McLaren in the development and production of high-performance sports cars.
The grand turismo body design takes its styling from the SLR race cars of the 1950s and the McLaren Mercedes Silver Arrows currently running the F1 circuit. The latter influence most notably appears in the arrow-shaped nose encompassing the prominent Mercedes star at the front. The limited-production SLR has gone on sale in Europe, but will not be available here until summer. Mercedes reportedly has a two-year waiting list of 1,000 cars. Based on prices in Europe, you can expect to shell out north of half a million for the privilege of waiting in line.
Under the hood, a supercharged V8 from Mercedes-AMG delivers 600 horsepower and a 0-to-60 acceleration of just under 3.8 seconds. Top speed exceeds 200 mph. The AMG five-speed automatic transmission features three shift modes: comfort, manual and sport. A dry-sump lubrication system developed for race cars allows the engine to be mounted lower for better aerodynamics and lower center of gravity.
An example of the tech transfer from the racing partnership: a carbon fiber composite body, which Mercedes says provides more rigidity and strength than ever in a production vehicle. It also provides safety: First-ever carbon fiber crash structures help absorb more than four times the crash energy than conventional metals. The gullwing doors pivot forward from the front roof pillars instead of hinging at the roof.
Inside the SLR you’ll find chronometer-style gauges, individually padded bucket seats and a multifunction steering wheel with F1-type buttons for manual gear selection. The look is aluminum, carbon and specially developed “Silver Arrow” leather. Other standard items include automatic climate control and a Bose sound system. Can’t find the start button? Flip open the thumb cover on the shifter.
When it debuted in 1999, the Lexus RX300 led the vanguard of “crossover” vehicles: part car, part van and part SUV. So it only stands to reason that the highly acclaimed RX would serve as the launching pad for the first hybrid in its class as well, and essentially the only luxury hybrid on the market. And it will surprise few that the RX400h is every bit as accomplished as its sibling, in addition to serving up 33 percent better mileage (a combined 29 mpg). That boost comes from taking a variant on the RX330’s 3.3-liter V-6 and pairing it with three electric motor/generators. Precisely how these motors work together is something better left to Lexus engineers to explain; suffice it to say that the combination delivers 268 hp, compared with 230 hp in the nonhybrid. In essence, you are getting V-8 performance while maintaining mileage ratings double that of some SUVs. The only real noticeable difference in driving the 400h is at very low speeds, at which the gas engine isn’t operating. You’re left with the feeling of navigating a parking lot in some kind of space-age transporter that provides propulsion without the slightest sound.
Mercedes Benz E320 CDI
Are the guys at Daimler-Chrysler psychic, or just unwilling to turn their backs on good old German technology? Just when you thought the diesel engine was as dead as its 1894 inventor, Rudolf Diesel, along comes Daimler Chrysler with a new diesel-engined E-Class sedan, as well as plans to add a diesel to the Jeep Liberty. With gas prices bouncing around either side of $3 a gallon, the diesel is making a timely comeback. While the technology is not as daunting as the Lexus hybrid, its impact is equally noticeable. One listen to the CDI and you will understand that this is not your father’s diesel engine. A common-rail fuel-injection system shoots atomized fuel directly into the cylinders at extremely high pressure, virtually eliminating the clamorous sounds and noxious fumes of yore. The CDI engine delivers impressively on diesel’s promise of more torque, less fuel. Although the CDI is rated at a mere 201 hp (10 percent less than the gas engine), it delivers a whopping 369 lb. ft. of torque (vs. 232), peaking in a range of 1800 to 2600 rpm that is hardly above idle. This last fact is driven home in spades when you step on the accelerator and are instantly pasted to your seat before slowly easing as the tachometer approaches a low redline of 4600 rpm. Oh, we almost forgot: the EPA mileage estimate is roughly 40 percent better than the gas version (27 mpg city and 37 mpg highway).
I don’t like to give advice. I’ll give opinions.
You’ve got to get across to each individual that what we are interested in is what is going to work for all. You have to think for the group and not just of yourself.
I once heard team spirit defined as a willingness to lose oneself in the group for the good of the group. I used that for a spell, but it wasn’t quite what I wanted somehow. Eventually, I decided that I would eliminate the word “willingness” and institute “eagerness” an eagerness to lose one’s self in the group for the good of the group.
[A leader] is just part of the group. You have to be firm but not stubborn. Stubbornness we deprecate, firmness we condone. The former is my neighbor’s trait; the latter is my own.
We’re all different. The good Lord in his wisdom didn’t create us the same. Some players, for example, I had to pat on the back constantly, and there are others I had to pat a little lower and a little harder. You can’t treat everybody alike. You have to try to give everyone the treatment they earn and deserve under your supervision.
When you have to discipline, do it privately and not before others. Don’t embarrass them before their peers.
If a person in a leadership position shows interest and consideration and love for all those under their supervision, they will respond. And you can’t show them by just telling them. You’ve got to do it.
The person in the leadership position needs to set an example. Way back in the 1930s I read something that said, ‘No written word, no spoken plea/Can teach our youth what they should be/Nor all the books on all the shelves/It’s what the teachers are themselves.’
Everyone’s a teacher to someone. I think every leader in business, that’s what he is. He should be setting an example for those under his supervision.
You don’t know a thing that you didn’t learn from somebody else. Listening is the greatest teaching tool in the world.
Be careful about the rules you make. There is a gray area. In my earlier years, I saw no gray area. I was either this or that. And that was wrong and I made many mistakes as I look back.
My definition of success is peace of mind. Without that, in my opinion, you don’t have much, unless you have peace within yourself. Peace of mind in knowing that you made the effort to the best of which you are capable. You are the only one that will know that.
I think success comes from within oneself. I think an individual is the only one that can validly determine whether or not they have been successful. I think it’s like character and reputation. Your character is what you really are and you are the only one that really knows that. Your reputation is what you are perceived to be by others. They might not be the same. They could be, but not necessarily. As Mr. [H.L.] Mencken says, things work out best for those who make the best of the way things work out.
My father gave us two sets of threes that he asked us to try to live up to: Don’t lie, don’t cheat, don’t steal. The others ones were: Don’t whine, don’t complain, don’t make excuses. Just do the best you can.
I think people are the same today as they were 50 years ago and will be 50 years from now. There will be changes in society. There’s no progress without change. Perhaps I’m wrong, but it seems to me that there’s more emphasis today placed on material things. Material things are not lasting; they eventually all get away. Not enough emphasis is placed on things that are lasting. If we just try to get that idea cross.
I once spoke to Lewis [Alcindor] (Kareem Abdul-Jabbar) and I said, ‘You know, Lewis, I can work on our offense and make you the greatest scorer in collegiate basketball history. But I said we wouldn’t win any championships if we did that. And he said, ‘Coach, you know I wouldn’t want to do that. I’m more interested in what the team does.’ And he was that way. Fortunately, he was a superstar, and Bill Walton was a superstar, and they thought of the team first. As a result, I think the team as a whole did much better than they would have if they had been thinking of their individual statistics.
Grantland Rice, a great sportswriter whom most people have never heard of, back in the ’20s or ’30s wrote a poem on how to be a champion. It’s a little longer, but it starts: ‘You wonder how they do it/You look to see the knack/You watch the foot in action/Or the shoulder or the back./But when you spot the answer/Where the higher glamours lurk/You’ll find in moving higher/Up the laurel-covered spire /That most of it is practice/And the rest of it is work.’ And that’s the cornerstone of the [success] pyramid. It’s industriousness. It’s work. The other cornerstone is enthusiasm. You have to enjoy what you are doing. You can’t be looking for the short cut or the easy way or the trick all the time. Work. That’s essentially what that poem says.
How to reach: www.coachjohnwooden.com
Not at all. The arrival earlier this year of the H3 gives the tough-as-nails Hummer line a kinder though not gentler sibling.
While the H3 is not going to have your Sierra Club friends patting you on the back, it’s 20 mpg highway and 16 mpg city EPA rating put it comfortably on par with more prosaic SUVs. Most of that improved mileage comes from the simple fact that the H3 is smaller 16.8 inches shorter, 6.5 inches narrower and 1,700 pounds lighter than the behemoth H2.
Of course, the smaller size makes a smaller dent in your wallet much smaller, in fact. The new H3 carries a base price under $30,000, though we would opt for a fully decked out unit in the $36,000 range. Contrast that with a $53,000 sticker price on an entry-level H2 (easily reaching $60,000 with options) and more than twice that for the original Hummer H1.
Worried that a smaller stature and lower price would come at the expense of a Hummer’s essential Hummerness, we wanted to put the H3 to the test. Fortunately for us and everyone else in Northeast Ohio Central Hummer has just opened a new East Side location, complete with a nine-obstacle test track at 25975 Central Parkway in Beachwood.
After a couple of trips around the short, obstacle-laden course, we found the H3 is every bit as capable and in some ways more capable than big brother H2. Sure, it gives up a little in clearance (about 9 inches versus 10.7 for the H2), but its smaller size makes it more nimble and its welded, box frame construction gives it more strength and stiffness.
From the first obstacle on the test track the rock ’n’ roller, which showcases the optional locking rear differential’s ability to propel the 4,700-pound H3 forward with traction on only one wheel to the 40-degree side slope to the concluding 60-degree incline and V-ditch, the H3 ably handles everything the track throws at it, even in the hands of an inexperienced off-roader.
The most impressive feats the H3 handled with aplomb were, as expected, those that required going up and over formidable impediments to forward progress. At the vertical step, the H3 worked its way up and over a 16-inch-high concrete “step” with minimal effort.
Those with fear of flying may want to avoid the 60-degree incline, a 12-foot-high hill that leaves you staring at nothing but blue sky on the way up and solid concrete on the way down. What’s particularly impressive on the way down is the H3’s ability to walk itself down the hill, without aid from the brake, thanks to an incredibly low reduction ratio in the transfer case that results in speed of just 1.7 mph at 1000 rpm (with the Adventure option package).
The Hummer test track is open to potential buyers during normal business hours. And according to General Manager Bruce Johnson, there is no shortage of buyers.
“Sales have been very good,” he says. “The H3 has brought in a lot of people that probably would not be a Hummer buyer.
“There’s no certain type of people buying this,” he adds. “The same was true with the H2. People thought it was mostly athletes, but a lot of the people who first bought the H2 were entrepreneurs individualists.”
HOW TO REACH: Central Hummer East, (216) 514-2700 or www.centralhummer.com
Doug Cheesman raised eyebrows and tempers when, shortly after he purchased Retail Planning Associates Inc. in 1991, he relinquished a major account Disney.
Employees were angry and surprised to hear hed turned away the $900,000 contract, Cheesman says. But as chairman and CEO, he thought the client asked too much of the firm for too little compensation.
That was the epitome we would have lost $200,000 to execute it, he says.
That move was just the start. Cheesman also closed four out-of-state offices and reduced RPAs client list by nearly two-thirds in an attempt to turn around the struggling company. After all, RPA had annual revenues of $8 million after more than 14 years of business, but it was losing nearly $1 million a year.
To remedy that, Cheesman decided, everything must fit into RPAs three core purposes: integrity, profitability and fun. He pared back anything that didnt fit the mold.
The change was almost immediate. RPA lost money the first two months under Cheesmans management, but hasnt since. In fact, the company is generating triple its revenues of seven years ago.
Sometimes you have to be confident and stick to what youre good at, Cheesman says.
Cheesman took matters into his own hands when, shortly after he purchased RPA, employees could not answer the question of how many accounts they had.
I went to accounting, and with a yellow highlighter I counted all the people we served: 160, he says.
He immediately began to chisel the list to fit his mold for a more profitable company.
He eliminated the companys offices and some clients in Boston, New York, Atlanta and Seattle. Each office had been an existing company when it entered the RPA fold, so Cheesman simply offered each one the opportunity to become licensees and they eventually weaned themselves away again.
These [offices] were cash flow negative to RPA by several hundred thousands a year, he says. We went positive immediately.
Eliminating those offices left him with 60 clients and a game plan. That plan was to form extended relationships with these remaining clients and select future ones so they would use all, not just part, of the companys retail strategy, design and implementation services.
At that time, 48 percent of our business was with clients we had worked for the previous year. Today, thats about 75 percent, he says.
His actions brought an interesting result, especially when it came to turning down work that didnt fit RPAs new profit-driven strategy. Not once in seven years have we not gotten business as a result of turning away business, he says.
Cheesman wont take a job that wont be profitable and provide a value-added service to the client. Instead, he refers the work to others even giving out the names of competitors if the competitors are good.
That honesty gains him credibility, which makes others come to him for business, he says. We want to do as few things as possible that were very good at for as few people as possible without putting all the eggs in one basket, Cheesman says.
Creating an identity
Cutting losses and advocating consistency, Cheesman says, was step one; step two was finding an identity for the company.
I found 38 versions of our identity, he says, referring to the companys name and logo, which differed on letterhead, business cards and signs.
Again, Cheesman focused. He determined what RPA did best was provide expert advice, so he asked the marketing department to come up with a printed piece, not to sell RPA, but to position the company as an expert in the retail industry. Retail Update, which notes industry trends and facts, in addition to highlighting RPA projects, is sent quarterly to an international database of industry and company executives to whom RPAs expertise would be most valuable.
It was funny for marketing to write a document that did not sell our services, Cheesman says. This was meant to position us. People would open it and read it and say, These guys must know everything there is to know about retail and truthfully, we do.
This, then, enabled RPA to act as an agency for clients and provide the start-to-finish services Cheesman wanted from repeat clients.
For Kodak, for example, RPA created campaigns to help Kodaks store owners create an identity based on the emotional side of creating memories rather than the technological aspect of film development.
We know how and why people are purchasing things, Cheesman says. We sold them expert advice that helps them sell more of their products.
Those stores saw a 77 percent sales increase for the first five months compared with the year prior, he says.
Watching the purse strings
Overall, Cheesman says his plan for focus has had the biggest impact on turning RPA around.
Were a finite resource, he notes. If the object of the game here is to be who we say we are and make money at it and have fun, we have to use those resources as efficiently as we possibly can.
Cheesmans focus also has meant maintaining smart money practices. He financed RPAs purchase so he could pay it off and gain a credit history. He funded all the companys growth internally until September 1998, when he began raising outside capital for the $3 million launch of a new software product to create networks between RPA clients and their customers.
Hes also being careful with global expansion. RPA has offices in London and Mexico, but for the most part, Cheesman forms affiliations with firms and individuals to maintain the international clients that make up about one-third of his business.
Now, he and his employees have begun to ask themselves: How do we know weve reached success with our product? What is it going to feel like?
We boiled it down to one line: Theyll be calling us, Cheesman says. We still work hard to market our services. We really are starting to get there to a certain degree.
Joan Slattery Wall (email@example.com) is a reporter for SBN Columbus."
The result: A new No. 1 golfer in Bob Fairchild, president of Fairchild Chevrolet, who sports a +1.5 USGA Handicap Index. For the uninitiated, that means he adds a stroke and a half to his score on average courses.
Fairchild, the 1993 Ohio Amateur winner and a 15-time Canterbury Golf Club champion, debuts on our list along with a number of other top execs with scratch games, including just-retired Actron Manufacturing CEO Tom Slater, who won the Kirtland and Pepper Pike club championships last year, and Welded Tube President Bob Lewis Jr., one of the winningest players in Walker Cup history and captain of the 2003 and 2005 U.S. teams.
The Brewer-Garrett Co. CEO Lou Joseph, who held the top spot for several years, now ranks eighth, though he can give anyone a game with his 0.4 index, according to the Golf Handicap Information Network.
Our list is by no means exhaustive, so if you know of a top executive who deserves to be on the list, send us a note at firstname.lastname@example.org, or call (440) 250-7078. To qualify for the list, a player must be a top executive and have a current handicap in the GHIN system.
No. 1 Bob Fairchild +1.5
President, Fairchild Chevrolet
Canterbury Country Club
Golfing pedigree My father started me playing golf when I was 9 or 10. I played for Bay Village High School and Northwood University in Midland, Mich.
Equipment Callaway Big Bertha driver, Adams 3+ wood, Mizuno MP-29 irons, Wilson Designed by Arnold Palmer putter
Ball Titleist Pro V-1x
Money shot I drive the ball very well and I putt the ball very well.
Best round 66 at Canterbury
Dream course My dream round was a 69 at Augusta National (last) December.
I play golf because it’s such a huge part of what I am and who my friends are.
No. 4 Paul Voinovich +0.3
Principal, Vocon Design
Kirtland Country Club
Golfing pedigree I started playing when I was about 5 years old. I played at Gilmour and at John Carroll.
Equipment Titleist 983K driver, Titleist 15o fairway wood, Callaway X-14 irons, Titleist Vokey wedges, White Hot No. 2 putter
Ball Titleist Pro V-1x
Money shot Not putting. My irons, I guess.
Best round 67. My best at Kirtland was a 70.
Dream course Oakmont is pretty nice. Winged Foot is pretty nice, too.
I play golf because it’s my fix. It’s nice to be outside. It’s nice to play with friends or people you’ve never met. It’s a game you can play for all your life. It’s just a great game.
No. 8 Lou Joseph 0.4
CEO, The Brewer-Garrett Co.
Westwood Country Club
Golfing pedigree I took it up about 15 years ago. My brother, Larry, is a scratch golfer. He was always after me to play. He got me going on golf.
Equipment Titleist 983K driver, Titleist 3 wood, Hogan Apex irons (forged), Scotty Cameron TEi-3 putter
Ball Callaway HX Tour (Black)
Money shot I’m consistent off the tee.
Best round The second time I shot 67 I had five birdies in a row and then I just held on.
Dream course Augusta National
I play golf because it’s the ultimate challenge. It’s you against nature. And every day you start all over again. You can’t win; you just borrow it. And in golf you don’t root against anybody. I love the integrity of the game.
No. 14 Don Misheff 2.2
Northeast Ohio Managing Partner, Ernst & Young
Firestone Country Club
Golfing pedigree I didn’t start playing until I was about 20 years old. I never played on a formal high school or college team.
Equipment Cleveland 460 driver, Sonartech 3 wood, Titleist 690CB irons, Scotty Cameron Newport 2 putter (made for Don Padgett)
Ball Titleist Pro V-1x
Money shot I’m still trying to find one.
Best round My best round is yet to come
Dream course Ballybunion in Ireland. It’s what golf is all about.
I play golf because of the people. I’ve been blessed with the amount of people I’ve been able to meet in life that came through golf.
What are the elements of being a successful negotiator?
The first key is a thorough understanding of one's own value system and to be an introspective process that considers short-term economic gain, long-term economic security, geographic location, whatever considerations are important to an individual and to be very clear on those before getting into a negotiation. If you're talking about a CEO, is it more important to him to have a big corner office or is it more important to have flexible locations or is it more important to have the right benefits package. In other words, people need to be clear on what truly is their top priority because many times in the work it is impossible to create the perfect result and hard choices have to be made.
The next step is research: it's a thorough understanding, if we're in a business context, of the industry itself, and the economics of that industry that one is dealing with. It's necessary to immerse oneself in a thorough understanding of what the business practices and economics are of any individual area. Then a thorough understanding of the world as the other negotiator sees it. Putting yourself into the heart and mind of the person on the other side of the table. Understanding what the pressures are on that person. Is this someone negotiating for themselves, is it someone negotiating for an owner or a CEO. In other words, how much real authority does that person have, and what is going to be a result that will ultimately make that person happy and look good. It's understanding of sort of how to research in a way to create win-win.
Then you have the whole issue of presentation. I like to think that the person I'm negotiating with is intelligent and has pride and dignity. So rather than simply saying, ""I want this or else..."" I think it's real important to create a rationale for whatever result you want to get to. In other words, in negotiating many time the question is whose reality is going to prevail. There are a number of factors and considerations that go to pricing or go to what the economics could be. They need to be organized in a way that shows the value or the service that you're representing or the corporation has great value for these 12 reasons. And try to quantify it using bar graphs and using color exhibits to make your position stronger. To create, if you will, an intellectual argument to motivate the result that you are trying to get, and hoping that if people agree on the 15 premises that the actual outcome will be much easier.
I think successful negotiators need to have the ability to distance themselves personally and not expose all of their emotional range in a spontaneous way. In many senses we are trying to avoid 170,000 years of evolution which has left us with tremendous intellect and technology but the emotional system of people is still similar to when we ran away from wooly mammoth. So we're trying not to turn something into an ego fight between two parties that will break down and become competitive and hostile to each other.
A successful negotiator needs to be able to bleed a certain level of emotion out of him and understand that this is not a contest where you have to achieve victory over another person - the vanquisher and the vanquished. Not only is that concept destructive, but its not very effective. So the key is how to craft a win-win scenario. So bleed emotion out of it.
Organization is important in terms of whatever the financial proposal is that's being dealt with. A good negotiator knows that proposal backwards and forwards and is able to quantify what concession A will being in terms of benefit B. In other words, what is the relationship on a list of 20 issues between conceding one thing and receiving another. There needs to be a mastery of that ahead of time.
The other key in all of this is setting the stage. A good negotiator needs to anticipate the negotiation a year, a year and a half in advance. Since the key to all this will be leverage, the ability to have an option or an alternative. Because without very little can be achieved. But the time to think about that is a year ahead of time, whether your selling your business or selling yourself as an executive. The time to think about that is a year and a half before. From an employee standpoint, create the concept of irreplaceability, as opposed to being a fungible, modular totally replaceable entity, someone is irreplaceable, invaluable. The institution can't go on without them.
Or to the extent that you are trying to actually sell a business or a concept or supplies. There has to be an alternative buyer or seller as the case may be.
Does it matter what you are negotiating?
The subject of negotiations can be varied; the principles remain the same. Research is critical. Organization is critical. Establishing the right spirit is critical. But most critical before anything is establishing leverage.
Is there such a thing as a win-win negotiation?
Most people in the world of business have repetitive relationships where they continue to deal with other human beings on an ongoing basis. The consequence of savaging someone -- of embarrassing, humiliating, driving out of business another person -- is to mean that it will be very difficult to ever do business again. Any transaction after that will be characterized by hostility or suspicion, so that stepping on the neck of someone who is vulnerable in any situation that's not a one-off is ridiculous. It takes away the ability to do repetitive business. The relationship has to be key and sort of a paradigm of honesty has to exist.
No deception will ever, ultimately, go undiscovered.
What's the most common mistake people make when negotiating?
First they become completely confused in what their priorities are. Instead of prioritizing and categorizing they think of 20 issues as all critical. They don't understand that if every single point in a situation is equally critical it becomes impossible to fashion a deal. There have to be some thins which are critical and area deal breakers, and some which can be compromised.
What is the dumbest mistake you every made in negotiating?
The dumbest mistake I made was to argue publicly that an owner was being unfair. The more persuasive I was in the press, and the more vividly and effectively I stated our case, the more rigid and intransigent the negotiator on the other side became. It ended up in a long and costly holdout that hurt a player and his career. The point is: be careful about the concept of external pressure because it may have unintended consequences. When we're dealing with the world of business, most people have pride and ego. To publicly embarrass or challenge someone can result in no settlement ever occurring. And generally when people say it can't get any worse, it can. When a situation seems convoluted and intractable and things seem very dark and foreboding, it is possible that they can get worse.
How do you break a deadlock?
Again we're trying to escape 170,000 years of evolution. People are trying to run from the woolly mammoth or to fight. They either flee or they fight. In a fighting situation, our human emotions are such that people can start to act in a very self-destructive way. In the case of deadlock: take a break. Go for a walk. Change the circumstances. Don't press a losing argument to the end. Be creative. Figure out another way to tackle the problem. But don't just sit staring each other down. Take a break. Change the atmosphere. Change the environment. Rethink your proposal. Try to get more creative.
The key there is to say, ""Look, obviously we've reached a little bit of an impasse, let's just give it a try another way. Part of the key is to try to encourage the other negotiator not to give enough. A really important quality in all of this is resilience. Things generally will look murky an d doubtful at different points. But if ultimately you want to achieve a result, you can't give up. You have to come at it with renewed creativity, energy and enthusiasm. So take a break.
One of your 12 essential rules of negotiation is never split the difference. Why is that?
Unless it's completely logical to split the difference. But splitting the difference assumes that both parties are equally in good faith and equally accurate in terms of their intentions to insist on a figure. For the sake of argument, if the fair market value of this car, the blue book would tell you is $10,000, and I come and offer you $3,000, then the concept is not to split the difference between 3 and 10, which would give you 6, it's to inform the other party that they do not appear to be serious at this time. The point is: splitting the difference implies that you have two totally reasonable positions which are equally credible.
Who is the toughest negotiator you have every faced.
I think a guy who was very tough for me was the general manager George Yong of the New York Giants football team. He recently retired but he was able to screen himself off from what would be normal pressures/. The imminence of training camp, the press commentary on a negotiation, the anxiety of the coach. In the case of a draftee he was able to make himself somewhat immune to all of those outside pressures and, therefore, unshakable. On an A through F basis, it would not be in his best interest to ever produce a C or a D result for the other side because it would be perceived as unfair. So the best that one could do almost every time was about a B+.
Again, this is someone who had self-confidence, who had a world view that philosophically had been worked out and who had a sense of perspective and who wouldn't be panicked or pressured into conceding too much.
How did you become a good negotiator?
Most of my experience was mostly political in school. It was much more in student politics or in political situations. Other than being a lawyer there is no classical training in the art of negotiating in law school. I inherited the very first pick of the draft back in 1975. I think psychology is probably the most important factor in understanding human behavior. Why people act the way they do and what will motivate them to act better. The ability to look past the words someone is saying to the subtext that may be present.
All of life is a negotiation. The reality is we negotiate in all of ours lives everyday. We negotiate with our wives over a whole series of circumstances, about how to spend time, about whose obligation something will be. We negotiate with our kids. All of us negotiate in the workplace. A large part of interaction has an aspect of negotiation to it. These are life skills. Anyone who thinks that negotiation is a subject that doesn't concern them is not properly analyzing their interaction in life.
What is the most important advice you have received?
To be very careful in manner and in terms of custom and verbally. Not to flight someone, in other words, not to allow a totally unrelated matter -- who returned whose phone call, who use fighting words -- to interfere with the flow of a discussion. To be careful not to give gratuitous offense.
There was a movie called ""Hoffa."" The Hoffa character, Jack Nicholson, explains to someone why never to slight someone: ""Because they'll remember that for the rest of their life."""
"The idea that one person could run a company with 360,000 people like GE with all those businesses is silly to even think about," he says. "But getting great people there to do it, you get the reflected glory of all their work. So you're nothing but a product of how many good people you get."
Welch got plenty of good people. In fact, four of the Dow 30 companies are run by CEOs who once were Jack's guys: Home Depot's Bob Nardelli, 3M's Jim McNerney, Honeywell's David Cote and, of course, GE's Jeff Immelt. In addition, dozens of other major U.S. corporations are run by ex-GE executives steeped in the master's ways.
Since retiring, Welch has consulted with Fortune 500 companies and written the autobiographical "Jack: Straight from the Gut." Now, following years on the road conducting question-and-answer sessions with businesspeople around the world, he has penned "Winning" with his wife, Suzy Welch, a former Harvard Business Review editor.
Smart Business caught up with Welch during his book tour to talk about the new work and the management principles that brought him so much success at GE.
Why did you use "Winning" as the title for your new book?
It sort of gets you down to this philosophy I have that the glass is half full. It gets you focused on all the things that you can do about not being a victim. I don't like victimhood.
So what I've tried to do in chapter after chapter is to show ways that people can get out of wringing their hands as victims. Whether it's how to get a new job, how to do a budget, how to do strategy, how to work for a bad boss - any of these things -- my wife and I try to put into perspective how you can take charge of yourself.
You open "Winning" with a section called "Underneath It All," in which you talk about your business philosophy. What is that philosophy?
My philosophy is that candor does wonderful things for people. It speeds the process. Everyone knows where they stand. One of the problems I see in business is people don't know where they stand. Differentiation is letting the best know where they are. And letting the weakest understand what their shortcomings are and what they have to do about it, not surprising them someday by laying them off.
So differentiation is how you build great teams. You are constantly raising the bar. And I think business is a lot like sports: The team that fields the best players wins.
Voice and dignity are, in fact, part of demanding or requesting or pulling the best ideas from everybody. Everybody wants to have a voice. We went through a workout process at GE that spent years and tens of thousands of town meetings asking for ideas from any level. And we tried to get to the point where ideas came not based on the stripes on your shoulder but from the quality of your idea.
The same thing is true about dignity: Respecting people by telling them where they stand. Never let them be in the dark. Always explain what they can do to do better, and if they can't do it, send them on their way.
But don't come in some day and say, 'We're having a recession and we've got to lay off two people and Mary and Joe, you have to go.' And Mary and Joe say, 'Why us?' And you answer, 'Because you weren't doing that well.' 'But we've been here 15 years and nobody's ever said anything.' That happens all the time.
I definitely think everybody has to know where they stand. One guy in Louisville said to me, 'You've had my arms and legs for 25 years; you could have had my brain for nothing.' That's true. The people closest to the work know the work. You should ask them.
So all those things are part of a fundamental philosophy. When they know where they stand and they are willing to speak out openly because candor is a value that's rewarded and you give them respect, you will get the most out of people.
How did you develop your philosophy of candor?
I've been that way all my life. My mother was that way. I'm an only child of an Irish mother. We didn't have any money. My father was a conductor on the railroad. Union household.
But she always said you have to face reality. 'This is the way it is, Jack. Don't wish for something. This is the way it is. Now go do something about it.'
Do you think it is difficult for people to have that kind of candor?
I think so. I see too much lack of it. I find it alarming. If your company doesn't decide it's an important value or behavior, they won't get it. You get what you define as the behavior you want.
If I tell you that what I want from you is candor and I'll reward you for it -- you'll get promoted for it, you'll get paid for it -- you'll do it. If you get slapped every time you do it because you're speaking up to the boss, you won't do it at all. You get the behaviors you ask for and reward.
If you start promoting guys that aren't candid and you say candor is important, you won't get any of it.
How would you describe your leadership style?
Hopefully, energizing. Hopefully, one that always gets the best out of people. One that recognizes the value of having smart people around you, people who are smarter than you are.
Searching all the time for the brightest people you can get your hands on. Knowing that, as a leader, the quality of the people you get determines how good you are. Not you. You can't determine how good you are. You're not good enough.
How do you identify the right kind of talent?
I always had a formula that was pretty straightforward: Four Es and a P. Do they have energy? Do they energize others? Do they have edge? Yes or no, and not maybe. Can they execute? And do they have passion? Do they care more than the next person?
If I'm hiring somebody from the outside, I'd always ask one question: Why did you leave your last job? Tell me why you are willing to leave if I am recruiting you. And then I let them talk for a while and listen.
You find out what they are griping about, where they are, where their pay is wrong or their boss stinks or whether they just want more challenge and they want to grow and flourish.
How do you get people to buy into your vision?
You better have a clear rationale. You have to lay it out. And you better be willing to say it until you're ready to throw up. You say it so many times, the last time you say it you can barely get it out of your mouth.
You can't repeat yourself enough in business. You can't change the mission every 15 minutes. You've got to make the case, rally the troops and then excite them to want to do it and then reward them for getting there -- in their soul with the job and in their pocketbook for doing it.
What skills do you need to be a successful CEO?
An ability to get great people. To excite people. This is no different than a sports team. If you get lousy players, you are going to lose. If you get great players, you win.
When you chose people for your management team, what traits were you looking for?
You really want people that can turn people on. You assume people have high integrity; that's sort of a ticket to the game. But you really want to have an incredible team of high-energy people that want to win, are excited by it and will be able to excite armies of others to do the same thing.
How do you measure success?
By setting some goals, a vision and the degree to which you achieve it. For me, long ago, it stopped being about money. It's about the team winning.
The big kick for me for years has been how many others won. Watching others get stock options, watching others grow, watching them change their lives.
How do you build loyalty in an organization?
I don't think you build loyalty. I think you build excitement. Loyalty is not the right word you're looking for. How do you keep energized people energized? How do you keep people excited about the challenges? Do you reward? Do you celebrate? Do you do all those things?
Loyalty implies a certain contract that you'll stay with this company for life. You don't have loyalty. The loyalty is to your customer. Only customers can give jobs. Companies can't.
So when you start talking about building loyalty, I don't want to build loyalty. I want to build exciting people who are excited to stay and are ready to leave if things aren't right.
I don't want people hanging on with the rope to the mothership. Loyalty is the wrong implication. I like people who, if we don't get it right here, they'll go somewhere else. So every manager has to excite his people to keep them there.
What's the most important business lesson you've learned?
Let's take getting the best team for a given. I was in Chicago for a Q&A session, and this guy said, 'I have a problem, Mr. Welch, with this differentiation thing and evaluations. I've got 10 people reporting to me. Two of them are smarter than me. How do I appraise them?' I said, 'What the hell happened with the other eight?' That's the point. He should have 10 that are smarter than him. That's what he should be looking for every day.
My other lesson is that culture counts as much in an acquisition as the numbers do. That's why so many acquisitions fail. The culture is so different from your own, that while the numbers might look good on paper, getting it to work is harder. [GE made 933 acquisitions during Welch's tenure as CEO.]
What was your toughest challenge in running GE?
[Long pause.] I don't think I ever had one. Every day was exciting. I loved every minute of it. I never it saw it as tough challenges. The worst thing you do in life is take people out of a job.
The toughest challenge has been when somebody can't perform up to your expectations and you've had the discussions with them for a year or so and you finally have to walk in and say, 'We have to part ways.' It's obviously the ugliest thing you do in business.
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