"Until one is committed, there is hesitancy, the chance to draw back, always ineffectiveness.“ W.H. Murray
Last month we discussed how to make the right choices in life and business. We talked of positioning ourselves as business leaders in such a way that we make good, solid choices.
This month, I would like to follow up that article with one concerning commitment and business. Will the two topics complement each other? I believe the answer is yes. In fact, I see the topics as dependent on one another.
Here is my premise: When we work through the process of making a choice and we lack commitment to that choice, ineffectiveness is sure to follow.
First, a few assumptions I hold related to commitment:
- Commitment is more than a head game.
- Commitment is positive.
- Commitment itself is a choice.
- Commitment flows from powerful leaders.
- Commitment is the driving force needed to push our choices into reality.
Now let’s fledge out each of these assumptions.
Commitment is more than a head game.
While our commitments start as a thought process, they cannot stay in our head. One way to state this is:
Commitment is a verb – it’s an action word.
Deciding to commit to a choice is only the beginning – now comes the real work. We must act on our commitment to that choice or, as I said earlier, ineffectiveness is sure to follow.
Commitment without action is worthless. When we have done the due diligence and made a right choice, we must act for that choice to have:
Commitment is so much more than a head game. It involves action.
Commitment is positive.
When business leaders decide to make a commitment to a goal, plan, strategy or new direction, they have made a positive decision.
Let me try to draw the timeline out a bit:
The leader has painstakingly worked through all the considerations needed in order to make a right choice.
The leader now makes a conscious commitment to that right choice and moves out in action related to the commitment.
The choice and the commitment are going to have a meaningful, powerful, results-oriented impact on the leader’s business.
That is positive. When we follow this series of actions, no matter what the outcome, the result is positive. This realization can help us as leaders to see our role and our work in a very different light.
Commitment itself is a choice.
This might seem obvious, but it is important for this reason:
Not committing to a choice that has been deemed “right” is a sure and certain way to open the flood gates of ineffectiveness in our business. Not committing is a choice we make to not do the right thing, the best thing, and the needed thing to move our business forward.
Simply put: committing or not – we make a choice – the difference is very important when it comes to good business.
Commitment flows from powerful leaders.
This is true, but the statement does not go far enough. In my estimation, real, powerful leaders are the ones that can make a choice, commit to that choice and take direct, intense action related to the choice.
This ability flows naturally from powerful leaders. It is second nature to the way they conduct themselves, their teams and their business. It is fun to watch it unfold.
Commitment is the driving force needed to push our choices into reality.
Each time we make a choice we are setting a goal that wants to be achieved.
As Mack R. Douglas reminds us that the good news is:
“The achievement of your goal is assured the moment you commit yourself to it.”
Commitment is the vehicle—the force—that drives our choices from concept to reality. The power of a simple commitment has transformed many leaders and their respective businesses. Without that power, I have seen business after business and leader after leader flounder and fail.
I think commitment is lacking in so many areas in our society these days. In developed and free nations, people are blessed with the ability to make choices, but often we lack commitment.
In business we are confronted with the need to make right choices on a minute-by-minute basis. Each leader and team member is charged with making choices as a significant part of their daily activities. Those choices then require a commitment. This is the game we play in the workplace and in life.
The process is really simple if you think about it: Make a choice. Commit to the choice. Act.
Are you ready?
DeLores Pressley, motivational speaker and personal power expert, is one of the most respected and sought-after experts on success, motivation, confidence and personal power. She is an international keynote speaker, author, life coach and the founder of the Born Successful Institute and DeLores Pressley Worldwide. She helps individuals utilize personal power, increase confidence and live a life of significance. Her story has been touted in The Washington Post, Black Enterprise, First for Women, Essence, New York Daily News, Ebony and Marie Claire. She is a frequent media guest and has been interviewed on every major network – ABC, NBC, CBS and FOX – including America’s top rated shows OPRAH and Entertainment Tonight.
She is the author of “Oh Yes You Can,” “Clean Out the Closet of Your Life” and “Believe in the Power of You.” To book her as a speaker or coach, contact her office at 330.649.9809 or via email email@example.com or visit her website at www.delorespressley.com.
Lois Kelly is the author of “Beyond Buzz: The Next Generation of Word-of-Mouth Marketing.” She offered her ideas about the top types of stories people like to talk about. If you’re pitching your company to investors, customers, partners, journalists, vendors or employees and you don’t use at least one of these storylines, you probably have a problem. And, most likely, you’re too close to what you’re doing, so you think that you’re uniquely “patent-pending, curve-jumping and revolutionary.”
1. Aspirations and beliefs. More than any other topic, people like to hear about aspirations and beliefs. (This may be why religion is the most popular word-of mouth topic, ever.) Aspirations are helpful because they help us connect emotionally to the speaker, the company and the issues. They help us see into a person or company’s soul.
2. David vs. Goliath. In the story of David and Goliath, the young Hebrew David took on the Philistine giant Goliath and beat him. It is the way Southwest Airlines conquered the big carriers, the way the once unknown Japanese car manufacturers took on Detroit and the way social media is taking on the media giants. Sharing stories about how a small organization is taking on a big company is great business sport. Rooting for the underdog grabs our emotions, creates meaning and invokes passion. We like to listen to the little guy talk about how he’s going to win and why the world — or the industry — will be a better place for it.
3. Avalanche about to roll. The mountain is rumbling, the sun is getting stronger, but the rocks and snow have yet to fall. You want to tune in and listen to the “avalanche about to roll” topic because you know that there’s a chance that you will be killed if caught unaware. This theme taps into our desire to get the inside story before it’s widely known. It’s not only interesting to hear someone speak about these ideas, but they also have the ingredients for optimal viral and pass-along effect.
4. Contrarian/counterintuitive/challenging assumptions. These three themes are like first cousins, similar in many ways but slightly different. Contrarian perspectives defy conventional wisdom; they are positions that often are not in line with — or may even be directly opposite to — the wisdom of the crowd. The boldness of contrarian views grabs attention. The more original and less arrogant they are, the more useful they will be in provoking meaningful conversations.
Counterintuitive ideas fight with what our intuition (as opposed to a majority of the public) says is true. When you introduce counterintuitive ideas, it takes people a minute to reconcile the objective truth with their gut assumption about the topic. Framing views counter to how we intuitively think about topics — going against natural “gut instincts”— pauses and then resets how we think and talk about concepts.
Challenging widely held assumptions means that when everyone else says the reason for an event is X, you show that it’s actually Y. Challenging assumptions is good for debate and discussion and especially important in protecting corporate reputation.
5. Anxieties. Anxiety is a cousin of the avalanche about to roll, but it is more about uncertainty than an emerging, disruptive trend. Examples of anxiety themes abound: 1.) Financial services companies urging baby boomers to hurry up and invest more for retirement: “You’re 55. Will you have your needed $3.2 million to retire comfortably?” 2.) Tutoring companies that plant seeds of doubt about whether our kids will score well enough on the SATs to get into a good college. Although anxiety themes grab attention, go easy. People are becoming skeptical, and rightly so. Too many politicians and companies have bombarded us with FUD (fear, uncertainty and doubt) with no facts to back up their point.
6. Personalities and personal stories. There’s nothing more interesting than a personal story with some life lessons to help us understand what makes executives tick and what they value the most. The points of these personal stories are remembered, retold and instilled into organizational culture.
7. How-to stories and advice. Theoretical and thought-provoking ideas are nice, but people love pragmatic how-to advice: how to solve problems, find next practices and overcome common obstacles. To be interesting, how-to themes need to be fresh and original, providing a new twist to what people already know or tackle thorny issues like how to get IT and marketing organizations to work together despite deep culture clashes between the two.
Here’s a good exercise for your team. Have them read this column and then answer the question: What storyline does our marketing currently use? Then, if you’re brave enough, ask the question: What storyline should our marketing use?
Guy Kawasaki is the co-founder of Alltop.com, an “online magazine rack” of popular topics on the web, and a founding partner at Garage Technology Ventures. Previously, he was the chief evangelist of Apple. Kawasaki is the author of ten books including Enchantment, Reality Check, and The Art of the Start. He appears courtesy of a partnership with HVACR Business, where this column was originally published. Reach Kawasaki through www.guykawasaki.com or at firstname.lastname@example.org.
The number of seismic changes in the way business is done during the past 10 to 15 years is unprecedented. Just ponder the magnitude of all that has occurred as you read this list: Cell phones became ubiquitous, and computers with 24/7 Internet access moved from the strident screechy tones and beeps of telephone dial up to today’s broadband connections that transmit huge amounts of data in seconds, resulting in virtually everyone being constantly connected.
Instead of getting the latest news at 11 p.m. and sleeping on it, we now receive a constant stream of information in real time. Reaction time has moved from digesting the myriad of hard copy reports that awaited you at the office each morning to now making decisions simultaneously with that first sip of morning coffee while reading data on a smart devise.
In addition, the era of easy money is also long gone, along with what seemed to be extraordinary and unlimited growth where the average company would do just fine, propelled by a rising tide of good times.
The tragedy of Sept. 11 jolted the world permanently, altering the way people live and think about the future. There are no more givens that one will grow up, go to school, get a job, have a family and live happily ever after. Two major wars have lingered beyond anyone’s worst expectations. Then came the economic meltdown of 2008 when the wheels came off the wagon and the music stopped playing while everyone frantically searched for too few remaining chairs. With the stock market crash and the banking/lending meltdown, even the most sanguine turned jaundiced toward their views of government, business and what the future holds.
Even those businesses naively ensconced in their fairytale cocoons realized it was no longer business as usual. What worked for years would no longer move the needle. Customers’ attitudes and loyalties could no longer be taken for granted as businesses acknowledged that future success and prosperity could well be the exception, rather than the rule.
Does this mean that everything that we’ve learned in the past has gone swirling down the drain, including basic business principles and practices that were sacrosanct?
There are no pat answers to deal with almost revolutionary metamorphoses, if you don’t change, you most certainly will become a victim of change.
Welcome to the new ‘now.’ If you’re leading an organization today, you must devote the majority of your time and efforts to looking ahead and trying to find the answers before your competitors even know the questions. Change has become how we must do business. What worked for your company previously is, at best, a fleeting memory overshadowed by the customers’ mindset of “What have you done for me today?” In short, there are no guarantees other than you’ll have to continuously get better or be gone.
A scary thought? It all depends how you approach this new reality. With changes come new opportunities, new ground rules and the ability to find a better way and deliver that better way more efficiently and effectively.
So how do you go about preparing for the future? Certainly use all of the new tools that are at your fingertips. Instant information on the Web is available to all of us with a few keystrokes directed at a growing number of sophisticated search engine. Data that took weeks and months to gather can now be gleaned in minutes or hours. While Americans are graying as the over-50 crowd mushrooms, don’t ignore the young who know only this new way of life. Does this mean you should add a few 14-year-olds to your board? Maybe not a practical idea, but be sure you’re at least talking to a couple of them on an ongoing basis. Ideas come in many forms, many times from the most unlikely.
You must retrain your team to challenge virtually everything and find a better way, envision products, goods and services that no one knows they even need yet, and create a strategy to deliver them compellingly and creatively.
Will there continue to be business casualties? You bet. Much more importantly, however, there will be many business successes for those companies led by visionaries who answer that morning wake-up call each day with an open mind to the new now.
Michael Feuer co-founded OfficeMax in 1988, starting with one store and $20,000 of his own money. During a 16-year span, Feuer, as CEO, grew the company to almost 1,000 stores worldwide with annual sales of approximately $5 billion before selling this retail giant for almost $1.5 billion in December 2003. In 2010, Feuer launched another retail concept, Max-Wellness, a first of its kind chain featuring more than 7,000 products for head-to-toe care. Feuer serves on a number of corporate and philanthropic boards and is a frequent speaker on business, marketing and building entrepreneurial enterprises. Reach him with comments at email@example.com.
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If you’ve been running a business for some time, then I’m sure you know some CEOs who are struggling to keep their business going or have already closed their doors.
In some cases, the cause might be the economy. Maybe they were in an industry hit particularly hard and were crippled by the drop off in sales or maybe a large customer folded or took its business elsewhere.
The most troubling aspect in many of these situations is that the person in charge didn’t necessarily do anything wrong. The leader made all the right calls and did everything by the book but still ended up with a struggling business.
After you’ve been running a business for a while, you realize that even doing everything right doesn’t guarantee success. The harshest lesson to learn is that you can’t control everything and bad things happen to good people and good companies.
The real test for many begins not with how they deal with success but how they deal with setbacks. Most have never tasted defeat before, and it can be a difficult experience. One day they are the CEO of a successful and respected company, and the next day they are sitting at home wondering what they could have done differently. The experience can be depressing for some and overwhelming for others.
But there’s a saying that as one door closes, another opens, and that certainly holds true with business. If you find yourself in the situation of leading a struggling business, you need to approach it as a challenge. Don’t waste time lamenting what could have been; focus your energy on what could be. Maybe you need to tweak your business, or maybe you need to completely reinvent your company, but the key is to do something.
Take McDonald’s for instance. In the early 2000s, the company was distracted by multiple acquisitions, a massive expansion plan and a menu cluttered with items consumers didn’t necessarily want. The stock price dropped to $12. The company reinvented itself by returning to its roots, divesting of the distracting side businesses and revamping its menu and restaurants to appeal to consumers. The results changed the perception of McDonald’s from a restaurant in decline to the undisputed king of the industry with a stock price in the $80 range.
Another example is IBM. The company was saddled with low growth after trying to dominate the consumer and business hardware and software segments, and its stock dropped to $10. The leadership refocused the company on business software, a few key business hardware components and IT services. It now dominates the business IT services category and its stock commands almost $200 per share.
While you may not be as large as IBM or McDonald’s, the point is that business is constantly evolving. Sometimes it means getting back to your roots, and other times it means abandoning one line of business in favor of another.
Take a hard look at your company and think about what you could do differently. Are there some product lines that are better than others? What if you focused on your core products and did them better than anyone else? Can you follow the lead of McDonald’s or IBM to chart a new course?
If it’s too late for that, look at your current situation and find a new path to success. You led a successful business once, so you can surely do it again. Reach out to friends and colleagues to find out where the opportunities may be in the market and think about a way they could invest in your new venture. You never know who may be able to lend a helping hand. One door may have closed in your career, but with some entrepreneurial thinking, the help of some friends and prayer, another will open. The best is yet to come.
Fred Koury is president and CEO of Smart Business Network Inc. Reach him with your comments at (800) 988-4726 or firstname.lastname@example.org.
A few weeks ago, I met with a member of our new business development team who had been on the job for a week or so. A few days before the meeting, I started jotting down notes about the message I wanted to convey and the points I wanted to make. These notes are the basis for my column this month.
There were seven points I wanted to stress to help the new team member be successful in our organization. Since my notes were a little cryptic, I will not only list them but expand on what they mean.
1. 900. My belief is that everyone has 15 minutes, or 900 seconds, of extra time during the day. Nine-hundred seconds where they have nothing to do; 900 seconds of basically free time.
For me, you need to take advantage of those 900 seconds and get better at something every day. It doesn’t matter if it’s gaining better computer skills or becoming a better presenter, just as long as you get better at something every day.
2. A new best friend. This was not only easy for me, but it’s essential. You need to make LinkedIn your new best friend. Since LinkedIn will be your new best friend, you need to spend time with it and get to know it. You need to understand the value of the tool and the power it has.
I truly believe if you aren’t using LinkedIn every day as a business tool, you are not as successful, efficient or smart as you could be.
3. Uncover hidden jewels. No, this isn’t about “Storage Wars.” (Even though I love that show, it isn’t what I’m referring to.) Every company has hidden jewels.
The question is: Where are they located? Where is that great proposal hiding? Who can fill you in on the company history, and who has the best value proposition that will help me sell our products and services and turn prospects into clients?
4. Get off to a quick start. I truly believe that if you get off to a quick start in the morning, you’ll accomplish more during the day. If you get off to a quick start prior to 8:30 a.m., this will be a springboard for a successful day.
People tend to feel good about themselves if they make things happen as soon as their day starts.
5. Each “no” gets you closer to a “yes.” Sales is a numbers game. Every time you get a no, even though it might hurt or upset you, it will get you that much closer to a yes and a new client.
6. Be a creature of habit. Without question, I am a creature of habit. I get in to the office and leave at the same time almost every day. I eat oatmeal at the same time, and I check the revenue of the company as soon as I arrive. The quicker you get into a routine, the better off you will be.
If you are in new business development, set aside the same time in the morning and afternoon to call prospects. Call your friends back at lunchtime when it might not be the most productive time.
7. You’re only alone if you want to be. This point is very important — especially if, like our new team member, you work at home. It’s very easy to bury yourself in your job and try to figure everything out yourself. Don’t do that. Stay connected to your office.
When your technology isn’t working perfectly, don’t try to fix it yourself. Call your IT department. When you’re responding to a proposal, if you have writer’s block, call a team member. Don’t struggle for hours. Remember, time is money.
Incidentally, the reason I had seven points was not that I couldn’t think of another few. My belief is that there are too many top 10 lists, and a top seven list would have a better chance to resonate with our new team member.
Merrill Dubrow is president and CEO of M/A/R/C Research, located in Dallas. The company is one of the top 25 market research companies in the U.S. Dubrow is a sought-after speaker and has been writing a blog for more than four years. He can be reached at email@example.com or at (972) 983-0416.
How Chris Maguire led SRS Real Estate Partners through a crisis by going back to basics and taking small stepsWritten by Peter Fehrenbach
Talk about getting hit with severe hardship right off the bat. In 2008, SRS Real Estate Partners split off to become a standalone company when its parent, Staubach Co., merged with another real estate firm. Then, a month later, the U.S. financial crisis began and flipped SRS’s world upside down.
“We sold all of the Staubach Co. assets to Jones Lang LaSalle except the retail business,” recalls Chris Maguire, SRS’s chairman and CEO. “We closed the sale in August 2008. We were just starting to adjust to life without Staubach. Then we got hit with the financial crisis.”
Virtually all U.S. business sectors were affected by the subsequent recession, but two markets that suffered especially abrupt, deep and lasting cuts were real estate and retail. And those markets are SRS’s bread and butter.
“In the real estate industry, I think anyone would tell you that of the four food groups, the retail business got hurt the most, because it’s led by consumers, and consumers got hammered,” Maguire says.
“When retailers shut their pipelines down in September and October 2008, it resulted in dramatic revenue declines for our business. Our brokerage business, peak to trough, was off 60 percent. And that went on for about two years before we were able to stabilize our business.”
The downturn was a rude shock for SRS. The company found itself thrown back on its heels with business drying up and bad economic news coming from all directions.
“We weren’t sure where the world was headed, much less how we were going to adapt our business,” Maguire says. “It was a scary, unbelievably uncertain time for our business.”
Get back to basics
As SRS’s revenue began to take a dive in the last quarter of 2008, the company’s leadership team members got together and circled the wagons. The threat level they faced was hyper-urgent. They had to find a way to rally their staff and stanch the bleeding.
“The first six months was the worst,” Maguire recalls. “Today, I remind our people all the time about that: Don’t forget how bad it was from September 2008 to March 2009. We really didn’t know what was going to happen to our business.”
The first thing SRS’s leaders recognized they had to do was to guide the company back to the basics of what had made it successful during the two decades-plus that it had operated as a unit of Staubach Co.
“What we realized we had to do was drill down to our core business,” Maguire says. “And our core business at SRS is transactions. We receive fees when transactions are executed. As long as transactions are taking place, that’s how we get paid.”
The financial crisis slammed the retail sector hard, and SRS began feeling the reverberations immediately.
“It was unlike anything I had seen in my career,” Maguire says. “We started seeing retailers who for years had been growing their business by opening new locations not only shut down their new-growth pipelines, but they also were scrambling to figure out how to get out of some of the deals they’d previously committed to.”
Therein, though, lay a key to SRS’s chances to reverse the tide and get back on its feet. Transactions were still taking place in the retail real estate business. It’s just that they were transactions of a different type than the Staubach Co.’s retail division had been used to seeing in normal economic times.
“We were clearly going from a period of growth to a period of contraction,” Maguire says. “That meant our clients were going to need help on the disposition side — getting rid of dark stores, restructuring existing leases. And our landlord clients were going to be doing a similar type of thing: Trying to figure out how to lease their centers in a very uncertain economic environment.
“So we knew the market was going to be difficult for growth. As a result, we had to focus on where the transactions would be. We had to shift from being a business focused on retailers growing to a business focused on retailers shrinking.”
Manage tough transitions
While SRS’s leaders and staff members knew retail real estate transactions were out there, uncovering them proved to be a tough learning curve for the company.
“It was rocky,” Maguire says. “Really, for 24 months, it was very tough going for us.”
Exacerbating the business problems were issues of insecurity related to SRS’s parting with its longtime parent company.
“We were not only dealing with an uncertain economic environment and a continual stream of bad news as it related to the consumer and retailers, we also were dealing with a company that for 22 years had been part of the Staubach organization and was now split off on its own,” Maguire says.
“So we got the double whammy there. It was hard enough going through an economic period that none of us have ever experienced, but to compound it, we were trying to teach our people that life is going to be OK without Staubach.”
The former football star had been an inspirational business leader, and many in the company found it difficult to adjust to having new leaders.
“It was hard for some people to grasp that, for it to sink in,” Maguire says. “Roger was an incredible leader. He had a great reputation. Being part of that company was important to people. And, well, I’m not Roger Staubach; I don’t have a Heisman in my trophy case. But I’ve been in this business for a long time, and our management team has been together for a long time.
“So we had to focus on the details, and on stabilizing our business. We had to focus on teaching our people how to deal with the market and the realities of where the transactions in the retail business were happening at that time, which were very different than where they’d been for the last 20 years.”
During the recession’s deepest depths, staff morale was a particularly tough issue to deal with for SRS’s leaders.
“We’re in a business where most of our people on the SRS side are independent contractors,” Maguire says. “They’re brokers that get paid commissions. It was hard to motivate them, as well as our own employees, when all they read in the papers every day and all they watch on TV is bad news. They walk into the office with their head down every day.
“We had to find a way to show them that, ‘Look, you can’t think about this day to day. You’ve got to ignore the bad news. You’ve got to come in here and focus on what you need to get done. We’ve been doing this for a long time. We’ve been through a number of cycles, and we will get through this. But it’s going to be tough, day to day. It’s going to be a marathon.’ And that’s clearly what it turned out to be.”
Focus on the achievable
For a few months, Maguire and his leadership team found their own morale running low, and that made it extremely difficult to motivate their staff. They learned that they would have to dig deep to find reserves of strength and hope within themselves.
“It was hard because none of us had ever experienced a downturn like this,” he says. “There were times early on when I stood up in front of our company and said, ‘Look, we’ve got to focus on our core business; we’ve got to focus on our history and our track record and the fact that there will be transactions there; if we do these things, we’re going to be OK’ — and for about six to eight months, I’m not sure I even believed it. But I had to get up there and project a positive attitude.”
Concentrating on taking small steps and improving the company’s standing little by little was an approach that began to turn the tide for SRS.
“There was nothing we could do at that time that was going to dramatically slow the decline in our revenue or stop retailers from shutting stores and from shutting off the new growth,” Maguire says.
“So we had to focus on small, achievable goals and wins. I looked at the situation and said, ‘Any progress we can make day to day is important.’ At the beginning of the downturn, five out of five days in the week were bad days. My goal initially was to just find a way to have one good day a week, then two good days a week, then three good days a week.
“Even in good times, not every day is going to be a success, and you’re going to have problems. But we really had to get our people focused on, ‘OK, what are you going to do today? How can we make a difference with these clients who we’ve had long-term relationships with, who still need our help — they just need it in a different way?’”
Not everyone was able to adapt to the new business realities that SRS faced. Some of the company’s longtime staff members found themselves unable to make the transitions that needed to be made.
“We had some people who had rode the wave for a decade,” Maguire says. “They were surfing a wave that was cruising along, and all of a sudden, that wave hit the rock shore and was gone, and those people got up in the morning and said, ‘What are we going to do?’ Our management team’s message to them was, ‘There are transactions out there. These retailers need our help. But you’ve got to get out and you’ve got to be proactive.’ And I’ll be honest with you: We had a number of people that had been very successful with our company that couldn’t hack it. And they had to go do something else.”
Communicating with staff is a tough thing to do when all of the news coming at you is bad, and Maguire concedes that he didn’t communicate very well at the beginning of the crisis.
“It was hard for me early on,” he says. “I like to communicate a plan: Here’s what we’re going to do, here’s our goal, here’s how we’re going to get there, here’s how the company’s doing financially.
“But everything was really uncertain. And I think probably one of my biggest mistakes early on was not communicating up front and talking about all the bad things — the bad news, the uncertainty. I had to work through that.
“My management team and others encouraged me to spend more time talking about those things: ‘Look, these are the challenges, and frankly, if this revenue decline doesn’t stop, we’re not going to have a business. So here’s what we’re facing. Let’s figure out how we can overcome it.’”
Thus, Maguire says a key piece of advice he would give CEOs facing a similar predicament is to be transparent and to convey all of the news clearly from the outset.
“Communication is the most important thing,” he says. “And not just the good news. Not just, ‘We have a plan.’ It’s much more than that. It’s, ‘Where is our business today, really? Where do we stand? Good, bad or ugly, let me know where we stand.’ And then, ‘Let’s put a plan in place to fix it.’
“One thing I’ve learned that I’m not sure I really appreciated before is that employees really want and need to know. I was concerned that if I give them too much bad news, they’re going to curl up and not be able to accept it. But the reality is people are smart and they deserve to know the real news, not just the CEO rah-rah.”
Eventually, haltingly, after rocky transitions and some shakeout, the U.S. retail business began to recover. And SRS’s business began to grow again as well. The 350-employee company now has about $45 million in annual revenue.
“For us, stabilization came when we saw the bottom,” Maguire says. “Our revenue flattened out, and then we started seeing growth. In fiscal 2010, we grew our business at just under 10 percent. Then for fiscal ’11, we were at 12 percent. And this year, we think we’ll be at 15 percent or so.
“Historically, our target has been 20 percent growth. As you get bigger, it becomes harder to hit that level because the numbers are bigger. But for us, we’d love to get back to 20 percent. It’s a bit of a stretch for us right now, but that’s our goal.” <<
How to reach: SRS Real Estate Partners, (214) 560-3200 or www.srsre.com
THE MAGUIRE FILE
Name: Chris Maguire
Title: Chairman and CEO
Company: SRS Real Estate Partners
Born: Trenton, N.J.
Education: University of Texas at Austin
What was your first job, and what business lessons did you learn from it?
My first job was delivering newspapers here in Dallas. It forced me to be accountable. I had to be there every morning on my bike picking the papers up and putting them on the doorsteps of all the people in the neighborhood, because if you didn’t deliver, they weren’t happy.
Also, we had to go out and knock on doors and collect the monthly fees for the papers, and some of those people were hard to collect from, but if I didn’t collect, I didn’t get paid. So that was some early insight into how the business world works.
Do you have a business leadership philosophy that you use to guide you?
In our business, you have two things you have to protect at all costs: your reputation and your relationships. If you do that, and you build a track record, you’re always going to do the right thing.
What trait do you think is most important for an executive to have in order to be a successful leader?
You’ve got to have vision. People want to work at companies that are going to grow, that are exciting, and that can be leaders in their industries. And in order to have that, you have to have a vision that’s not Disneyland. It has to be a vision that you can actually achieve over time.
What’s the best advice anyone ever gave you?
Roger Staubach had a lot of good advice. One thing he said that has stuck with me over time is “There’s no traffic on the extra mile.” It’s about putting in extra effort and working a little harder, because most people don’t do it. Hard work doesn’t necessarily ensure success, but it goes a long way toward achieving it.
More marketers see mobile texts growing as an effective campaign tool especially for local efforts. A couple numbers illuminate the reality and the potential for success:
- 6.1 trillion text messages sent annually — an average of 200,000 per second — according to The International Telecommunication Union, the United Nations agency for information and communication technology.
- Response time is usually measured in seconds or minutes. Corresponding lag time for email and voicemail messages average several hours.
Smart Business spoke with Michael White, chief technology officer at InfoCision, about the rise of mobile text marketing and how it is changing the call center business.
What factors drive the growth in text marketing?
Definitely the rise in the number of mobile devices. And, with the new generation, texting is how they communicate. It’s the new demographic. Also, there are some statistics out there that show that the age group for people who text is widening. It’s not just the 18-to-29-year-olds now. It’s the 30-to-40-year-olds and the 50-to-60-year-olds that are starting to text as well. So it’s becoming very commonplace out there.
How is the growth in mobile text marketing affecting the call center business?
We look at it from a service bureau perspective. We are handling calls on behalf of our clients, and what we’re seeing is that as we contact people through our traditional channels, people also want to be contacted via other methods.
As the types of communication channels change and options expand, we’re also finding people respond to texts a lot more readily than they respond to other forms of communication. I’ve seen statistics that show 90 percent of texts get opened and read within 15 minutes of being sent.
Texting is becoming a type of marketing that is exploding in popularity because of the growing percent of the population who have cell phones or mobile devices. As we see that proliferation, as a call center vendor, we need to be able to have that channel available to our clients so they can communicate with their customers or donors.
What changes are call centers making to capitalize on text marketing?
The main thing is they need to have a provider or in-house platform that is capable of sending and receiving SMS messages. (SMS, or short message service, is a standardized communication protocol that enables the exchange of text messages between fixed line and mobile phone devices.) It’s basically a tool set and call centers need to have the right tools to provide the service.
Why has InfoCision chosen to make this investment?
It’s another option for how our clients can reach out to their customers. In addition, because it’s a very new and emerging space, where we’re finding significantly higher response rates.
Michael White is the Chief Technology Officer at InfoCision. Reach him at (330) 668-1400 or firstname.lastname@example.org.
Protect the environment and lower taxes through conservation or renewable energy credits and incentivesWritten by SBN Staff
Not only is Texas a leading provider of crude oil and natural gas, but the state’s abundant sunlight and persistent winds offer businesses yet another opportunity to lead the nation by tapping renewable energy sources to power manufacturing plants, distribution centers and office buildings.
But despite the fact that Texas companies can leverage more than 80 federal, state and local incentive programs to defray the cost of purchasing and installing renewable energy systems and energy conservation equipment, executives in the Lone Star state are still leaving money on the table.
“Renewable energy and conservation incentives and credits allow companies to demonstrate environmental stewardship, increase operating efficiencies, and lower income taxes by defraying the cost of purchasing renewable energy and energy conservation equipment and systems,” says Laura Roman, CPA, CMAP, a partner in tax and strategic business services at Weaver. “Unfortunately, the funds often go unused, and the programs won’t last forever.”
Smart Business spoke with Roman about the opportunities to lower taxes and operating expenses and positively impact the environment by taking advantage of underutilized conservation and renewable energy credits and incentives.
Why should companies consider switching to renewable energy or energy efficient building materials?
The benefits include the opportunity to lower energy consumption and utility bills by installing modern, energy-efficient manufacturing equipment, windows or HVAC systems, and the chance to promote a positive public image by launching green initiatives and supporting environmental stewardship. Plus, both tenants and building owners can utilize the incentive programs and reap the financial rewards. For example, the improvements help owners by boosting property values, while tenants benefit from increased energy efficiency, which ultimately reduces operating costs.
What types of incentives are available?
There are more than 54 federal and 28 state and local programs that can be used for equipment purchases or upgrades that reduce energy consumption or utilize solar, wind, ethanol and biodiesel energy. The programs include tax deductions, credits and exemptions, loans and grants, rebates and performance-based incentives. For example, Texas businesses can qualify for commercial energy efficiency rebates, energy-efficient incentive programs, green building corporate tax credits and sales tax exemptions for purchasing energy and water efficient products. While the U.S. Treasury Department offers renewable energy grants for projects involving solar photovoltaics, landfill gas, wind, biomass, hydroelectric, geothermal, municipal solid waste, CHP/cogeneration, solar hybrid lighting, hydrokinetic, tidal/wave energy, and ocean and fuel cells using renewable fuels or micro turbines.
Best of all, executives don’t have to commandeer large amounts of cash to complete the projects because companies can tap different programs to train employees, purchase equipment or pay for installation contractors. So, companies can still invest in that much-needed marketing program or software upgrade if they utilize renewable energy incentives and credits to hire renewable energy specialists, replace inefficient manufacturing equipment or install a new HVAC system.
How do the incentives provide financial benefits?
Essentially there are five areas where companies benefit from renewable energy incentives and tax credits.
- Gross income exclusions. Companies can deduct the full amount of incentive payments or grant funds they receive for qualified renewable energy or energy conservation projects from gross income.
- Dollar-for-dollar deductions. There are no sliding scales or phased-out deductions. Companies can use every dollar they invest in qualified renewable energy and energy conservation projects to reduce their tax liability.
- Accelerated depreciation. Under IRS Section 179D, companies can depreciate the cost of purchasing new plant and energy equipment at a faster rate than typically allowed. So, instead of taking 39 years to recover the cost of a new lighting, HVAC system or building envelope, the owner of a 100,000-square-foot building can deduct up to $1.80 per square foot, or up to $180,000 in the first year.
- Ancillary funding and allowances. Funding is available to hire specialized workers or train current employees on the use of renewable energy equipment and processes.
- Multiple opportunities. Companies can tap multiple incentives for each project including loans, performance-based incentives, deductions, tax exemptions and grants, as well as property and sales tax rebates.
Should executives be aware of any special qualifications or rules?
The incentive plans and tax codes are fairly straightforward, but there’s no need to spend hours interpreting the criteria or deciphering nebulous clauses when a tax professional is intimately familiar with the nuances of each program. At the same time, he or she may help identify additional opportunities to complete the project without tapping cash reserves, and can often share tips and ideas from experience helping other companies navigate the process.
How can executives evaluate the ROI and choose the most advantageous projects?
Companies should discuss ideas and energy needs with architects, contractors and energy professionals so they can create a list of feasible projects and determine the material and labor cost for the various improvements. Review the list with an accountant, since he or she is familiar with the tax code and incentives and can provide an estimate of the cash outlay and ROI. Finally, act now. Remember, it costs virtually nothing to investigate these opportunities, and there’s no sense in waiting when the money to complete renewable energy or energy conservation projects is there for the taking.
Laura Roman, CPA, CMAP, is a partner in tax and strategic business services at Weaver. Reach her at (432) 570-3030 or Laura.Roman@weaverllp.com.
Insights Accounting is brought to you by Weaver
Earlier this year, Steve Carter, president and CEO of ii2P, challenged small and medium-sized businesses (SMB) to take a look at investment decisions around their current support models. This month, he stresses the importance of adopting a strong sense of urgency to avoid upcoming challenges.
“SMBs worldwide are projected to spend $1 trillion on IT by 2014. But unless something drastically changes, that spending could be like a heavy weight on a vessel headed into a perfect storm,” says Carter. “We want to stop, take a pause and not repeat history by spending money on technologies without really looking for a composite solution.”
Smart Business spoke with Carter about the challenges SMBs face, how to avoid common traps and the importance of managing cost pressure while strengthening customer intimacy.
Why do you feel there needs to be a heightened sense of urgency around creating change right now?
There are two fundamental problems facing the SMB market space: 1) cost pressures to stay competitive; 2) customer intimacy is in jeopardy. All companies with products and services wrestle with relieving cost pressures to maintain competitiveness. However, the most significant challenge I see is declining customer intimacy. This is an aspect that has been ignored. In order to sustain and grow market share, maintaining customer intimacy is paramount. Overall, a quality customer experience is missing, which shows up in lost market share.
What factors do you feel are causing these challenges?
A perfect storm is described as having multiple conditions that are colliding at the same time. There is a perfect storm in the SMB market today. First, all too often, we see both cost and customer intimacy elements are chained to an archaic standard support model. Such a model is actually designed to cost more to interact with the customer.
Historically, this has been why companies scrambled to find ways to cut back on support costs. This standard model is also designed to drive customer interactions out because it costs so much and reflects pure overhead. What this does is create an environment for the SMB that says, ‘Use it less, find a way to reduce calls for support.’ Sounds like a good thing, but it is deceiving. It’s a death trap for the SMB.
At the same time, the demographics of the end user have changed considerably and it is imperative that you respond to their wishes. Our clients have grown up in the technology world and favor what I call the ‘preferred end user support model’ — they prefer to satisfy the needs themselves rather than call a support center for help.
Lastly, by not considering and committing to a holistic approach when installing new technologies into your business, you are actually burdening your organization with incomplete and ineffective solutions.
How can the SMB know if it is facing the perfect storm?
There are some clear, obvious indicators that every SMB should use as beacons.
- Check your specific market growth. Has your business grown at a healthy rate? If you are not growing at a healthy rate, the storm will ultimately catch you.
- Check your client retention. This one is big. You can’t glaze over client loss as being a result of some external factor. Truth is, if you are losing clients, your model is working against you. The two key components are your cost competitiveness and your ability to be intimate with your end users.
- Check your profitability. This one should be obvious but can be deceiving. If your margins are falling, for example, don’t automatically blame costs of raw materials. The cost of your support model is a more obvious culprit.
What options does an SMB have if it determines it is facing a perfect storm?
There are three options that always apply, and the first two are the most common traps that sink businesses. The first option is to do nothing. Keep steaming straight ahead, believing the situation will improve. The second option is planning to do something in the future. While this one doesn’t sound quite as bad as doing nothing, it has the same result: the longer you wait, the more you lose ground.
There is a third option: Do something new. Now is the time to face the perfect storm.
How should an SMB go about implementing a new approach in order to avoid the perfect storm?
The thing to remember is that surviving the storm requires a balance between the two elements I spoke of earlier: managing cost pressure while strengthening customer intimacy. The first step to bailing water out of your boat is to analyze and optimize your current support model. Then establish a clear strategy and create self-improving client intimacy through customer-facing self-service.
We’ve all made the mistake thinking that just purchasing technology is the answer. Take a new holistic approach that will bring technology, process and management disciplines as a complete and total solution. Examine the investment in current IT expenditures and make the hard assessment: ‘Am I getting real return on investment?’ If not, make a change.
Finally, establish committed continuous improvement processes that focus on balancing the customer intimacy mandate with prudent cost management. With these approaches in place, clearing the perfect storm is simply a matter of having your clients use your new model more.
Steve Carter is president and CEO of ii2P. Reach him at (817) 442-9292 or email@example.com.
Insights Technology is brought to you by ii2P
When a company gets into a position of missing payments on a loan, the loan originator could possibly sell your debt to a third party. Once your commercial loan is sold, the velocity of both money and information becomes critical.
“Don’t panic,” says Brian R. Forbes, a member with Dykema Gossett PLLC. Instead, he suggests being proactive.
“The more proactive and transparent you are, the more likely the asset manager responsible for your loan will internally advocate options that may allow opportunities for a mutually acceptable restructure,” he says.
As a borrower, you have the chance to start your lending relationship over because there is no previous history with your new lender. Forbes says there is a possibility that you can restructure your debt on terms more favorable than offered by your original lender.
Smart Business spoke with Forbes about how to handle your distressed debt after it changes hands.
How do you define distressed debt?
Distressed debt would be any debt or credit that has one or more missing payments, either partially or in whole, or is in imminent danger of missing one or more payments without the ability to cure. If you are a borrower who has reached this critical point, there is a possibility your debt will be sold to a third party.
At what point does debt get sold?
Distressed debt can be sold at any given time. The third party that buys debt often has a different objective than the original lender because they are seeking to maximize their investment returns in a shorter time frame. Since the distressed loan frequently is purchased at a discount, an opportunity exists to negotiate terms more favorable to the borrower. The new lender could potentially offer more creative workouts, such as allowing the borrower more time to refinance, extending payments, stretching amortization or allowing a discounted payoff. A new lender is not always negative for the borrower.
How would you know your debt has been sold?
Most loan sale agreements require a borrower be notified immediately upon the closing of the loan sale. The loan buyer will contact the borrower quickly to ensure all payments due under the loan are going to the buyer and not to the seller. If the debt is in distress and there is a default, a workout specialist or asset manager will contact the borrower for updated information. In the best-case scenario, the borrower’s financial statements are complete and easily reviewed and verified, which enables the asset manager to quickly assess the situation and recommend a course of action.
The anticipation from an asset manager’s perspective is that information flows between parties within a month of closing. If the debt involves real estate, such as an office or apartment building, the asset manager will want to see rent rolls, pro forma financial statements and detailed budgets. The less information the asset manager receives, the more difficulty the asset manager has evaluating the credit and recommending a mutually favorable solution.
What’s at risk once it has reached this point?
The velocity of money and information is critical to the third-party debt purchaser. The new lender is making a decision as to whether there is a workable solution between it and the borrower. Many third-party buyers prefer to work quickly to resolve the asset with the borrower in either a full or, if justifiable, discounted payoff. In order to do this, the asset manager needs accurate information quickly to pursue the most cost-efficient action.
The remedies third-party buyers often exercise if they are forced to operate without the requested information include foreclosure, but generally third-party buyers do not want to own the property. Third-party buyers can enforce other remedies under any guarantees of the loan and pursue their rights against the guarantors and the underlying collateral. Third-party buyers will pursue a general workout strategy if it makes sense for both parties.
What should a company do when its commercial loan gets sold to a third party?
If a third-party buyer purchases your debt, anticipate that the new lender will be proactive in exercising its remedies under the loan documents in an effort to resolve the credit and that you should provide the new lender such information required under the loan documents. Remember, many debt buyers contractually respond to investors and lenders in the same manner as the borrower responds to the lender under the loan documents. It is advisable to have your asset manager well informed of your credit and circumstances in order to facilitate the best solution. Without sufficient information, new lenders often immediately exercise remedies.
Be forthcoming. Obtain counsel and with his or her advice gather and give your accounting information to your new lender who can evaluate and understand your credit as quickly.
What are the best-case outcomes once a company has reached this point?
The best scenario is the borrower obtains the opportunity to keep its business going, resolves a current credit that by its size may be limiting opportunities for the borrower, obtains for any guarantor a release from his or her guaranty for consideration, and either purchases the debt or refinances the debt at a price discount that corresponds to the current fair-market value of the asset serving as collateral or the value of the business. Do not panic. Everyone is interested in finding the best solution, which often means the borrower refinancing the debt with another lender.
Should a borrower get counsel involved?
Retain an expert representing borrowers in this context immediately to determine whether restructuring is viable and the best option. Counsel can help structure the best solution given the facts and circumstances of the underlying credit, while identifying and minimizing potential adverse tax consequences.
Brian R. Forbes is a member with Dykema Gossett PLLC. Reach him at (214) 462-6403 or firstname.lastname@example.org.
Insights Legal Affairs is brought to you by Dykema Gossett PLLC