Gordon Krater didn’t know where the bottom was. So he started focusing on the top.
Like just about every business leader, Krater had never seen anything like the recession that started in late 2008. The stock market started free-falling, the housing market crashed and two of the Big Three American automakers went to Washington looking for bailout money.
Not even the most educated and experienced of economic analysts knew where the slide would stop — or when. As the managing partner of financial and business advisory services firm Plante Moran PLLC, Krater faced a choice: Either brace for the eventual rock-bottom impact or focus his 1,700 associates on discovering present and future areas of opportunity despite the depths of the economic crisis.
“The most important thing was to not listen to all the noise,” Krater says. “Every day it seemed like there was bad news, but we couldn’t focus on just that. We needed to figure out what we thought was really going on. We needed to assess where we were and try to set a positive tone for the organization.”
Krater was elected managing partner in October 2008, on the front edge of the recession, and took over in July 2009, right in the middle of the economic free fall.
Thrust directly into the storm, he had to quickly figure out where Plante Moran could still generate positive momentum and rally his workforce around those areas — and he had to do it while his entire workforce was immersed in an environment riddled with stories of layoffs, foreclosures and bankruptcies.
“In the absence of communication, people assume the worst,” Krater says. “So one of the things I’ve learned over the years is that people really need to hear what is going on, and they need to hear that you are still confident in the company’s future. People won’t follow pessimists. They’ll follow optimists who are also realists.”
Get the real story
During the recession, employees at companies around the country consumed daily media reports about the deepening crisis. By the time team members arrived at the office for work each morning, they had already scanned a newspaper, watched TV during breakfast or listened to the car radio on the ride to work. Krater was already facing an uphill battle against negativity before he stepped into his office each day.
Krater couldn’t stop the bad news, and he couldn’t stop his staff from consuming bad news. But he could show everyone at Plante Moran that there was another side to the story.
Yes, the economy was in dire straits, and yes, it was putting a strain on just about every business. However, that was the surface-level story. If Krater dug a little deeper and asked a few more questions, he believed he could find the toehold that would help give his people a more positive outlook on the future.
To get the answers to his questions, Krater utilized Plante Moran’s vast and powerful client base.
“We have a really solid base, so we are a great place to take the pulse of the economy,” Krater says. “We have thousands of clients that include influential companies and leaders in our region. So I went out and talked to them. I tried to get what was fact versus what was conjecture, the real reactions to the issues at hand versus the reactions to a state of paranoia.
“I wanted to get a real sense for where our clients thought things were going, and where things were headed in reality. I didn’t want to just read a bunch of things in the media and allow us to be influenced by that. We needed to talk to our clients to get a real sense of where things stood.”
Krater was able to take what he learned from the firm’s clients and use it to keep his staff more thoroughly informed. If Krater foresaw a drop in business related to a particular account, he shared as much as he could regarding the reasons behind the drop in business and the potential severity of the drop.
“Rather than simply saying, ‘Business is down,’ we tried to answer how far down,” he says. “There is a big difference between business being 40 percent down and 5 percent down. If we had someone worried about whether a contract would be renewed, like a major auto supplier, versus having a contract canceled outright, there is big difference between those two. A big part of what we had to do was differentiate what was really happening versus the fear of what might happen.”
Krater wanted to focus his people on the day-to-day work of running the firm, not the horror stories coming from the nation’s financial centers. The staff at Plante Moran couldn’t help what was happening in Washington and on Wall Street, but they could do something about positioning the firm to weather the storm by strengthening its client relationships.
“People were concerned about the possible collapse of the financial system,” he says. “It was this growing idea that business as usual was over, and there was a new normal, which was a difficult concept for a lot of people to accept, both here and elsewhere.
“Here in Detroit, we had a front-row seat to watch GM and Chrysler go into bankruptcy, and nobody knew if they were going to come out. So all of that was swirling around, and we couldn’t do much about a lot of it. So what we needed to do was focus on our clients. We needed to do what we could, which was to serve our clients in the best way possible to help them through those tough times.”
Taking control of a crisis means to take control of communication. Your people need to hear the truth about your company’s situation directly from you, which means you need to stay well informed, so that you can better share information with your people.
During the depths of the recession, Krater wanted to give his associates at Plante Moran a realistic view of the situation that the firm was facing. Often, people associate realism with pessimism. Nobody has ever associated a reality check with something positive. But Krater believes pessimism can run as rampant as optimism, if left unchecked.
“That’s why you can’t panic,” he says. “That is why you try to get to reality, to what is real versus what is being thrown around out there. You try to find your own answers as to what is going on out there with the economy, as opposed to taking what you read at face value. Of course, I read everything I could get my hands on about what was happening out there, but you verify what you read.
“You can be truthful and realistic and optimistic at the same time. I wanted our people to know that despite what was happening, we are still going to be here, we are going to emerge stronger than ever, and most importantly, here is how we’re going to do it. You need substance to your message.”
By taking control of communication, you are really taking control of your culture. When tales of woe are assaulting your people from all sides, morale starts to erode; the collective confidence of your people starts to wane, replaced by anxiety and paranoia, which produce a counterproductive work environment.
With frequent and comprehensive communication, you can combat the negative inertia of a crisis by reminding your people why your company can still be successful and by focusing everyone on those items. That approach reminds your people that they’re not helpless, they’re still capable of controlling the company’s destiny, and they have a means of pulling the company out of the crisis.
In short, you want to promote a message of empowerment.
“We tell a lot of stories around our firm, and we’ll talk about clients and their experiences with us,” Krater says. “Frank Moran was our founder, and his undergraduate college degree was in philosophy. One of the things he’d talk about was the idea that we were a people firm disguised as an accounting firm.
“So we have been focused on our culture, ideals and principles since the beginning. We’ll relay stories to each other about a staff member who helped a client, how it happened and so forth — not unlike how I hear Quicken Loans does it.
“If you ask a person who has been there for two years or more, they’ll be able to give you a number of examples of how to deal with a given situation, based on a story they heard from somebody.”
Properly managing communication, and by extension your culture, is a critical component of crisis management. If you let your culture wither in a time of crisis, you’ll find it is a long road back when you set about rebuilding it.
“Every company has a culture,” Krater says. “The question is, is it good or bad? If you let your culture go bad, one of the toughest things to do is rebuild it. It takes so much energy and time, and it’s just a very difficult task. It takes energy away from serving those who you have to serve outside the company in order to make your living. We have a great culture here, and one of the things we do is fiercely protect it. You can’t let anything get in the way of that.”
Invest in what you can
During a recession, or any time of crisis, you need to spend money.
It seems counterintuitive when business is down and revenue is drying up, but when you face choppy financial waters, your company needs you to invest in resources and talent more than ever.
At Plante Moran, Krater and his leadership team made a commitment to hiring new talent during the recession. With added talent, Plante Moran was able to explore new business avenues and set itself up for a period of growth as the recession has loosened its grip over the past two years.
Plante Moran frequently hires college graduates straight from campus, but during the recession, Krater and his team took a bit of a different approach.
“Other companies had to cut some really good people loose, and because of our strong culture and reputation, we were able to attract some really good people who had been cut from other companies,” he says. “That’s one of the biggest advantages of making your culture a priority. You can provide opportunities for people, and they know you are a great place to work.”
If your people know they can impact the future in a positive way, they’ll want to work for your company, regardless of the economic landscape. If they know their work will be appreciated by management, and make a difference in the long run, it will be much easier for your people to tune out the negativity around them and develop a goal-focused mindset on improving your company’s outlook.
“People want to feel like they’re in the know, and they want to feel like they are making a difference,” Krater says. “One of the problems you can run into as an organization gets larger is this attitude of, ‘If I don’t do this one little thing, it won’t matter.’ It can become harder to connect them to the impact they can have.
“Any business, any profession is a game of inches. The little things make the difference between real success and not doing as well. It’s having people who are empowered and believe in their ability to make an impact that makes the difference. That is where you find the real gold.” <<
How to reach: Plante Moran PLLC, (248) 352-2500 or
The Krater file
Education: Bachelor’s degree in business administration, University of Michigan
First job: It seems like I always worked growing up. I was always cutting grass or babysitting. The first time I got a W-2, however, I was a lifeguard at a municipal pool when I was 16.
Krater on making an impression on Michigan State University men’s basketball coach Tom Izzo: We have an annual firm conference where we close the firm down for a day, right around the end of our fiscal year on June 30. Every single person is invited, no matter what their role is. It’s a day when we talk about the firm, what we’ve done, what our goals are going forward, and we celebrate. We celebrate not only the successes of the firm, but of the individuals in the firm.
Oftentimes, we have a guest speaker, and one time we had Tom Izzo come in and speak to us. I was talking to him before the meeting, he had his notes on what he’s going to say, and he asked me ‘So, who is here today?’
I told him everybody in the firm is here. He says, ‘You closed the whole place down? Every single person is here? Not many people walk their talk like you guys do.’
On the spot, he changed what he was going to talk about. He talked about (his 2000 national championship team) that had a rough start to the year. And he actually called in the maintenance man, his administrative assistant and a lot of other people besides just the players. He told everyone, ‘You know what? We’re not doing a very good job. Everybody has to do better, because everybody contributes to the success of this organization.’
He talked about how when they won the national championship, and they got the championship rings that everybody covets so much, the first ring went to the janitor, because he is the guy who opened the gym so the players can practice.
That sends the message that everybody’s contribution is important. That is how we feel, and needless to say, he was a big hit speaking to 1,700 people about something that we really try to practice.
On November 28, the 2012 Midwest Social Media Summit will be held at Executive Caterers at Landerhaven in Cleveland, OH. This one-day-conference will offer tips and insights from social media experts and top business leaders who will help you reconsider your strategy or validate your approach.
For more information and to register, click here.
And as a special bonus to our Smart Business readers, we're giving away five FREE tickets to the event! To enter the contest, simply do one of two things:
- Visit the Smart Business Twitter page and follow us. Then just send out a tweet that says, "I don't want to be anti-social. I want to attend the 2012 @Smart_Business Midwest Social Media Summit!"
- Visit the Smart Business Facebook page and like us. Then post to the page, "I don't want to be anti-social. I want to attend the 2012 Smart Business Midwest Social Media Summit!"
We'll draw the winners on Monday, Nov. 19.
For additional information, please contact Anne Hydock at email@example.com or (440) 250-7041.
A good board of directors can be a great support for a top executive regardless of company size. The most common type of board offers advice; however, other boards act as fiduciaries, which have legal liability for the company’s practices – and thus are much more actively involved in overseeing the company. In either scenario, before establishing a board of directors, a small business owner needs to be clear about why he or she wants a board and what the owner is prepared to do to get maximum value from a board.
These steps can help with developing your board of directors:
1) Get prepared. Write down what you want them do, how much time they will need to commit monthly, how long you want them to serve, where you and the company need the most advice, and what are you willing to provide as compensation to board members – if anything. Many nonprofit boards don’t offer payment beyond lunch, but for-profit entities typically provide a quarterly stipend or payment.
2) Choose broadly. Many business owners draft friends and industry colleagues to sit on their boards initially. However avoid picking carbon-copies of yourself. Look for board members with diverse backgrounds and perspectives. It is useful to have board members from a wide range of fields, including legal, finance, accounting and marketing. Organizations such as the U.S. Small Business Administration’s SCORE program of retired business executives and The Alternative Board can connect groups to potential board members.
3) Orient the board. While board members may be familiar with your organization or products, they may have only a broad understanding of your operations. Therefore, it may be useful to provide orientation for incoming board members to cover organizational structure, functional duties for each division and division head, a brief description of each product/program/service that includes its target market, as well as pie charts that display major revenue streams and expenses.
4) Share authority. Many entrepreneurs conceive and build a company according to their liking and their understanding of the customer. Owners and managers should run the day-to-day operations in alignment with the board policies. A good board will encourage the development of processes for rationally researching, analyzing and assessing all aspects of the company. Moreover, few board members want to give up their time to meet to essentially rubber-stamp every executive decision.
5) Reassess your board periodically. What you need today to help your business flourish may not be what you’ll need in three or five years. As you periodically conduct mid-term strategic planning, you should review the skills and resources presented by each board director in light of where you want to take the company. Don’t be afraid to disband and redesign your board.
Patricia Adams is the CEO of Zeitgeist Expressions and the author of “ABCs of Change: Three Building Blocks to Happy Relationships.” In 2011, she was named one of Ernst & Young LLP’s Entrepreneurial Winning Women, one of Enterprising Women Magazine’s Enterprising Women of the Year Award and the SBA’s Small Business Person of the Year for Region VI. Her company, Zeitgeist Wellness Group, offers a full-service Employee Assistance Program to businesses in the San Antonio region. For more information, visit www.zwgroup.net.
Enterprise Content Management (ECM) enables organizations to go beyond traditional document management by providing an integrated enterprise platform for managing the complete life cycle of information, automating content-centric business processes and enabling records management.
“Companies are using ECM in a wide variety of ways to solve diverse business problems. New technology innovations are rapidly increasing the capabilities of ECM, making it an even more useful tool,” says Prashant Kothari, head of ECM practice for HTC Global Services.
Smart Business spoke with Kothari about ECM and how it can help organizations manage ever-growing content and information.
Why ECM is important?
An ECM platform can help organizations to gain better control of content and information. It also helps streamline business processes to increase productivity and efficiencies, thereby reducing costs. An ECM platform brings all the information together in a way that helps knowledge workers to make decisions faster.
What types of businesses can benefit from using ECM?
It can benefit nearly every business that deals with content in both forms – paper and electronic. Content could include documents, emails, faxes, multimedia, transaction records and other digital assets.
ECM is critical for any business that is dealing with challenges such as large volumes of content that need to be made more accessible and usable, inefficiencies in completing operational tasks that require content for decision making, or regulatory compliance mandates that require greater control over unstructured information within the organization.
How does business process management tie in, and what benefit does it offer to a business using ECM?
Business process management (BPM) enables automation of manual business processes. It provides a comprehensive set of workflow capabilities for the end-to-end automation. This helps automating task assignments, triggering tasks on a specific event or decision making using predefined rules.
It integrates content with business processes, thereby helping an organization to make timely decisions using the most accurate information available. Such capability can reduce cycle times and improve productivity across the entire organization and deliver significant return on investment.
What is the process of setting up an ECM system for a business?
The ECM platform provides software components that can be used in standalone mode or with other components as a unified platform. At a high level, these components can be grouped by functionality for imaging, content and data capture, content management, process management (workflow), records management, electronic forms, collaboration and business rules management.
The process starts with the assessment of content management needs and process management needs (if any). Identify the type of content that needs to be managed and the format of the source content. How and who all will need access to the content once it is stored in a repository?
This assessment is then used to identify the ECM software components that will be used to implement the solution. Once the ECM components are identified, hardware and infrastructure requirements are defined.
The solution is then designed by defining configuration for content capture, management of various content types, users access, user roles and security, system integration, storage for repository, and reporting. The software is then configured and customized as per the design.
There are several ECM software products in the market to choose from, and these products can be procured and set up in-house, or hosted by external vendors. Some ECM vendors are now offering their software via cloud (or SaaS) model as well.
Typically, to setup an ECM environment, one has to set up ECM software components and database software on appropriate hardware (server/s). Configure storage devices such as Storage Area Network to set up content repository. Configure network administration and a security server such as Active Directory for setting up user authentication and defining access privileges. Configure content ingestion tools to import content from various source such as email, fax and online. Set up scanners and/or multifunction copier machines for scanning paper documents.
Implementation of advanced features could require configuring workflows, deadlines and content retention policies. Some products provide features to define search templates that can be configured for each business group to enable easy way to search, retrieve and view content.
What should a company expect to invest in an ECM system as far as time for installation, training employees to use the system and updating and maintaining it?
That varies depending on the size of the organization and its needs. Implementation of a basic system requires minimum time and training. Users can easily learn the system within a couple of days. However, if it’s a complex solution that incorporates business process management, then the implementation and training could take few weeks.
From a support perspective, these products are very stable and don’t require significant effort to maintain and support. However, periodically, one has to review database growth, and storage needs to handle the growth in content and transactions. Manage user accounts and also monitor logs for transactions occurring within the system and verifying users accessing the system.
What is the return on investment?
It increases as you move up from basic imaging and document management features to advanced workflow automation and legacy integration to electronic discovery and content analytics features. However, for a business that primarily relies on paper for all type of information could achieve significant ROI with just a basic system. This basic system could address challenges of managing paper, content sharing and delivery, disaster recovery, business continuity and regulatory compliance.
ROI is calculated on a case-by-case basis by considering factors such as the current cost of information capture, information management, storage, sharing, processing, and communications management. Typically the efficiency gained by implementing ECM goes from 20 percent and beyond.
Prashant Kothari is head of ECM practice for HTC Global Services. Reach him at (248) 530-2555 or firstname.lastname@example.org.
Insights Technology is brought to you by HTC Global Services.
"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.
Thinking about blogging? Below are the major topics I discuss with CEOs who are considering setting up a blog.
To blog or not to blog
Do you have the time to commit to blogging? A successful blog, whether CEO- or company-driven, takes a time commitment, not only to allocate to the writing of compelling and interesting topics but to also map out an ongoing strategy of what you want the blog to accomplish.
Consider whether or not you are going to actually enjoy blogging. If you end up considering the blog a chore or burden, you will ultimately abandon the blog.
Before beginning to blog, check out what other CEOs are writing about. There are a ton of lists of CEO blogs that can be accessed by doing a quick Google search, along with reviews of who’s doing it right or wrong — and why.
Done right, CEO blogs help establish a voice for the company, create dialogues with internal and external stakeholders, build awareness and educate about your industry and its trends and challenges and establish you as an intelligent and strategic thought leader.
Newspapers are typically published anywhere from daily to weekly. TV news is typically broadcast a minimum of three times daily. To attract readers and grow and retain repeat visitors, determine how fast you want to grow a meaningful readership base.
For maximum growth, many experts say you need to post multiple times daily. The reality is that as a CEO, if you or a ghostwriter is blogging more than one to three days per week, it is a stretch of your time and content commitment.
To ensure your blog doesn’t become an afterthought, map out your blogging topics and posting dates four to eight weeks in advance.
Social media — whether in the form of a blog, discussion groups or pages on popular social platforms such as Facebook, LinkedIn, Twitter, Pinterest and others — is based on the premise of transparency and authenticity. Be timely and candid with your posts.
People might not always agree with what you have to say, so be ready to accept differing opinions. Remember that anything you post is out there for life. Even if later you decide to take the blog down, chances are that posts may have been archived and reposted somewhere else.
What to blog
Your blog shouldn’t be about what you sell. If you do the blog right, it will end up translating to new business. Write about what you know and the platforms and podiums for which you want to be known. Do you have compelling or thought-provoking insights on leadership, lessons learned, industry trends or other topics attractive to your target readership? Get to the point in your blog posts and save fluff and selling for your advertising and annual reports.
Blog posts don’t have to be novels or dissertations. As long as you are publishing content of interest to your readers, they can be short and sweet.
Consider posting some video entries and posting photos to go along with your written word to add variety.
Private or public blog
Are you planning an internal employee-focused blog, or are you planning a blog to be viewed by the world at large, which includes existing and prospective customers, your competitors and the media?
If your focus is to motivate and educate your employees, a private company blog would be most appropriate. Remember that anything you blog whether on a private, public or invitation-only blog has the potential to be republished and shared with others.
Adrienne Lenhoff is president and CEO of Buzzphoria Social Media Marketing and Online Reputation Management, Shazaaam PR and Marketing Communications, and Promo Marketing Team, which conducts product sampling, mobile tours and events. She can be reached at email@example.com.
How Andy Morrison and Rob Stone created an effective succession plan at Market Strategies InternationalWritten by Erik Cassano
The topic of succession planning had been on the table for quite some time for Andy Morrison and his fellow co-founders at Market Strategies International. But it wasn’t until 2006 that the clock really started ticking.
“We started to understand, really around 2000, that as we matured in the business, it was time for us to start thinking about who would be our successors, really under the condition that we wanted the firm to remain independent,” Morrison says. “That is when we started to think about a succession plan and a succession strategy for our positions.
“But in 2006, we acquired a private equity partner, Veronis Suhler Stevenson, and that was really the second stage of succession planning because now we had an outside partner and a board of directors.”
As a component of the partnership, Veronis Suhler Stevenson mandated that Market Strategies look for add-on acquisitions, particularly companies that had younger leadership.
“That was a main part of the criteria for any acquisition, that we find young-but-seasoned management who would be in the business for a considerable period of time and could potentially become companywide leaders once they joined our organization,” Morrison says.
In 2007, Market Strategies acquired Doxus, a marketing and product strategy consulting firm, bringing Rob Stone into the fold. Morrison and the leadership team quickly identified Stone as someone with high growth potential in a leadership role and began grooming him in an executive vice president’s role.
In February, Morrison — the company’s CEO since 1994 — decided to step down, effective March 31, transitioning into the chairman’s role. Satisfied with Stone’s development, the leadership team offered Stone the CEO’s position, which he readily accepted.
That’s the short version. In reality, it wasn’t as simple as Morrison stepping down and Stone stepping up. Over the course of many months, Morrison and Stone worked together, along with the rest of Market Strategies’ executive team, to develop and execute a detailed succession plan that fell in line with the overall goals of the market research and consulting firm and to communicate it to everyone in the company.
Lay the groundwork
A good succession plan is a road map. It shows you where you need to go and what possible routes you can take to get there, so that you and your team can plan the safest and most prudent route for your business.
The preparedness of the leadership team is something that made an immediate impression on Stone when he joined Market Strategies in 2007.
“That is one of the factors that worked well in our favor,” Stone says. “Andy and the entire cohort of founding managers have always been very transparent in the company regarding what their plans are, what the timelines are — because it is critical for people to understand what the road map looks like so that these sorts of changes don’t come as a surprise.”
The transparency is the result of an ongoing dialogue among the top managers in the company. The communication among the members of the management team gave Stone and George Wilkerson — who was named president at the same time Stone was named CEO — an opportunity to have a voice in the decision-making process as the future of the company took shape.
“There is a level of unnecessary surprise that can mar succession planning,” Stone says. “The communication process, which allowed myself and George to be completely invested and present in the key strategic decisions that the company has been making, helped remove that. It also has helped us to be more available and present to the staff at large.
“It has always been clear to our people as to who has an ongoing voice in the management of the company, who were the people on the executive committee and who were the people authoring the strategic three-year plans.”
Even though Stone and Wilkerson were involved as members of the leadership team, their consideration for the top spots in the organization wasn’t automatic. Market Strategies conducted a lengthy search that narrowed the field down, first to an internally focused search, and then specifically to Stone and Wilkerson.
Morrison and his team initially looked at candidates both inside and outside the organization. They wanted their ideal candidates to possess a number of qualities, including areas of expertise that Morrison’s team didn’t possess, such as experience with international markets.
Developing a list of essential qualities that every leadership candidate must have is a critical component to the hiring process. Along with international experience, Morrison and his team constructed a list of other qualities needed to successfully lead Market Strategies, which generated $75 million in revenue during 2011, Morrison’s final full year as CEO.
“On the established leadership team, we knew we had to think about who the replacements might be, and that was very much spurred by the integration process,” Morrison says. “We knew we wanted to add younger businesspeople who had played a big part in running their own companies. They knew how to meet a payroll, they knew what it takes to manage a business.”
However, along with the valuable experience and skills comes baggage. Incoming leaders learn how to manage according to the rules of their previous company, and assimilating them can take a certain amount of deprogramming and reprogramming.
“The baggage manifests itself in a number of different ways,” Morrison says. “Their own track record can work against us. They might have had to sign significant noncompete agreements that create major barriers to them holding a management role at another firm.
“Age was another factor. Some other people we talked to had a similar age to myself and those of us who were already leading the firm, which meant there was no real advantage in terms of bringing them aboard in a successor capacity, since they were probably looking at retirement as well.”
Morrison never hired a third-party search firm, but he and his team did work with a consultant on an informal basis. The consultant helped Morrison refine the criteria for evaluating a leadership candidate, which ultimately led to a focus on internal candidates.
“He is a trusted industry adviser and ran one of the largest firms in the industry at one point,” Morrison says. “He helped give us the final insight regarding what he saw as the advantages and disadvantages of internal succession planning candidates versus external.
“When you add all of that up, it really did lead to the fact that we did have candidates internally who were going to be as well-qualified and well-positioned as we could have hoped for. That is what convinced me that we would be fine selecting from the people who were already managers in the organization, as opposed to people who were on the outside.”
Step into the role
The transition occurred at the end of March, but soon after Morrison and his team zeroed in on Stone as their CEO candidate of choice, they began to train him for his role. One of the chief responsibilities Stone needed to master is that of communication.
It’s perhaps the biggest difference between a leader and an assistant. The leader needs to oversee the entire organization, not just a piece of the pie. An assistant coach in football or basketball might only take charge of the offense or defense. He might manage a section of the playbook. But the head coach has to bring every player on the roster together and unite all of the players around a common set of goals.
That means the head coach, much like a CEO, has to know how to communicate effectively to a large audience.
In the six months prior to their formal appointments, Stone and Wilkerson ramped up their interaction with the entire Market Strategies workforce. It was a job with an added degree of difficulty due to the acquisitions the company had made in recent years, which meant a portion of the company’s employees weren’t originally members of the legacy company — including Stone and Wilkerson.
“That was one of the concerns for the people here who had been a part of the legacy Market Strategies for quite a while,” Stone says. “They wanted to know what this means, if anything, for our culture because the people now leading the company at an executive level are not the people who founded it and led it for the first couple decades of its existence.”
Stone’s primary location was another area of concern for employees. Stone is based in the Atlanta area and decided at the outset of the transition that he had no desire to relocate to the Detroit area. He would, instead, visit the company’s Livonia headquarters on a regular basis while primarily operating out of Atlanta.
“We had to ask ourselves if that really matters anymore,” Morrison says. “Does it really matter if all the C-level officers live in one place? We’re a smaller firm, but I had to ask myself how a Ford Motor Co. operates when their leadership is literally worldwide, with senior officers on every continent. In this day and age, if you haven’t learned to communicate worldwide, you’re in trouble from the get-go. You need to be able to effectively communicate worldwide.”
With modern communication technology, you can effectively run a business with executives, managers and employees in different locations. But it also creates an added set of challenges for someone in Stone’s position.
Most critically, if you aren’t there in person each day to promote the vision and strategy of the organization, someone else needs to be communicating in your place. Otherwise, you run the risk of complacency setting in.
It’s something that Stone has worked at tirelessly in the months since he’s taken over the CEO’s role and something that he’ll continue to work at as he fine-tunes his approach.
“That’s the danger in an internal transition, particularly if you’re running an organization with several lines of business,” Stone says. “To answer that, George and I are continually ramping up our communication, particularly to the next group of leadership candidates that we hire. We want to impart the best practices that we would hope leadership candidates would abide by. Their first priority upon accepting their new role is to get out there, talk to people, be present and available.
“It’s easy to get complacent. If you’re transitioning into a new role from another place within the organization, you can kind of become complacent yourself. You can take it for granted that people throughout the company know you, that the people on your team know you.
“That’s why, when you are assuming a new role like this, you need to put as much attention and care as is possible into reaching out to your people, getting your message into all of your various offices and locations.” <<
How to reach: Market Strategies International,
(734) 542-7600 or www.marketstrategies.com
Andy Morrison, chairman, Market Strategies International
Rob Stone, CEO, Market Strategies International
Morrison: Doctorate in mass communications research and bachelor's degree in English and journalism with a teaching certificate, University of Michigan.
Stone: Doctorate in cultural studies, Columbia University.
What is the best business lesson you’ve learned?
Morrison: Constant communication, which includes both talking and listening. Everybody emphasizes listening nowadays, but you also have to be an effective talker.
Stone: You have to be absolutely dedicated to the success of your clients and colleagues. It seems like one of the simplest lessons to learn, but it is one that is seldom learned.
What traits or skills are essential for a leader?
Morrison: You need integrity in every sense of the word. You need to be open and transparent in your communication, and deliver on the promises that you make to clients and employees. I also admire decisiveness. Make a decision and set in motion the steps you need to get to the result you want. That is something that is critical to me.
Stone: I would add that you need to convey passion for what you do. That is a big part of our job as leaders, to constantly convey the passion and excitement we feel to all of our teams.