Orange County (1091)

There’s an old saying that the best way to get yourself out of a hole is to stop digging.

The problem is that, too many times, you think there’s a treasure lurking just a few more shovelfuls down, so the digging continues. As the hole gets deeper, you keep at it because you’ve already put so much effort into it that it would be a waste to stop now.

There are many examples in business of these ever-deepening holes that eat up manpower, time and money. Sometimes, the elusive treasure is a product that’s sputtering along but just can’t quite get going like you had hoped. Other times, it is a person who has all the promise in the world but doesn’t have much to show for it other than a warm chair and a lot of frustration on your part. The “hole” might even be an entire division that is underperforming or a vendor that just isn’t meeting your needs.

Corporate America is littered with decisions that seemed like a good idea at the time but that just didn’t work out. Remember New Coke? It was meant to replace the Coca-Cola that everyone grew up with, but it lasted only 77 days before the classic formula was reintroduced to the market.

The Coca-Cola Co. wisely made the tough decision that its reformulation didn’t pan out the way it had hoped and brought back the old formula. The result was that while New Coke may have failed, the company retained its top spot. It realized the hole was getting too deep with no return in sight, so it got out.

If you’re going to be successful, then you will have to make tough decisions. No matter how close to the buried treasure you think you are, at some point, you have to take your shovel and climb out of the hole and move on.

It’s called cutting your losses. Coke executives could have stuck to their decision because every bit of market research showed that people liked the taste of the new formula better, but it just wasn’t showing up in the sales figures. Maybe you’ve invested a lot of time and money into a product or a person, but there comes a point where you have to give up and focus your resources on more productive areas.

You can’t be afraid to make these tough decisions. It might be easier to justify further expense to keep going, but don’t wait any longer. Pull the plug.

Ending a project that’s bleeding money is an easy decision. The really tough choices come with the marginal performers — people included. To know when enough is enough, you need to set up accountability for projects and people so you can measure how well things are going compared to the standards you’ve set.

If something isn’t measuring up, get rid of it. In today’s business world, profit margins are too thin to waste money on unproductive portions of your business. You can’t afford to have a nonproductive anything — be it a person, division or product — weighing you down. Do everything you can to help the people affected move on, but make the decision and stick with it. These types of decisions are never easy. You never know how they will affect your business. It will always be easier to keep going after that elusive return on your investment, but you have to hold yourself accountable, as well. If it’s not working, it’s time to make a change.

So stop digging now before the hole gets so deep that you are unable to climb back out of it.

If you are interested in learning more about publishing a book, please contact our publisher, Dustin Klein, at dsklein@sbnonline.com or (440) 250-7026.

Fred Koury is president and CEO of Smart Business Network Inc. Reach him with your comments at (800) 988-4726 or fkoury@sbnonline.com.

In developing a strategy, creating a new business or launching a product line, intensive preplanning is what can make the difference between success and failure. This same principle applies to negotiating just about anything. No matter what you want to achieve, be it selling a new customer, buying a competitor or hiring a superstar, you must determine what is the end result you want before you put pen to paper or make that first introductory call.

We’ve all heard hundreds of time about the importance of “putting yourself in the other guy’s shoes” or showing some empathy. Good basic advice, but do you really follow these suggestions?

In many business relationships, if it becomes a win/lose transaction, at the end of the day, one side is going to be very unhappy and the other side, albeit temporarily satisfied, could ultimately lose, too. In most instances, both sides have alternatives. Unless you have found the Holy Grail that no one can live without, the other side always has choices. One of which can be to do nothing and take a hike.

Most negotiations begin with the thought, “What’s in it for me?” Instead, the first question should always be, “How can we enable the other side to win (or feel as though they have won)?” It’s all about looking at the objective through the other person’s eyes. This simply translates into giving the “opposition” something that they must have, even if they’ve yet to realize it, while meeting your own needs. Rather than start with figuring out how much can you make on the deal or the positive result that will accrue to you if you hire a particular superstar, ask yourself, “What can I do to make the other side feel like the winner?”

For your next initiative, start at the end and work toward the beginning. You might just be pleasantly surprised with the road map you construct using this technique. Here are a few examples.

You want to buy a competitor because it has a product that will enhance your offering, but you don’t need all of the other widgets that this target manufactures. The traditional strategy would be to make an offer knowing that, if you succeed, you’ll scuttle all of the company’s other operations, cherry-picking what you want from the carcass. This could work and might be the easiest way to achieve your goal, but this Machiavellian method of taking no prisoners likely won’t play well with the target company owner, who has spent years building it and is emotionally invested in the business and the organization’s employees. When you look at the situation through the lens of the founder, you determine that a different approach, such as paying a good price for the entire business, plucking the item you want from the company, and then selling the rest of the company back to the employees could be the ticket to getting discussions started. This way the owner gets his money, he is a hero with his employees, and you acquire the product you need to grow.

Let’s say you want to hire the best salesperson in your industry who, unfortunately, works for your competitor. Instead of just going in and offering a big salary and bonus, which he or she most likely has already been offered by someone else, try to determine, after doing your homework, what this superstar’s hot buttons are. Maybe he has made it known that he would like to work remotely from a desert island while continuing to build his book of business. Looking at it from his perspective, you figure out that you can buy him his piece of sand somewhere with a beautiful view, obtain highspeed Internet connectivity to his paradise and allow him to work six months per year in his dream location. Rather than just making a cash-rich offer, start the negotiations by providing a solution to your target’s fondest expectations.

Putting yourself in the other guy’s shoes is far from a new idea. However, too many executives forget that creating a win-win is preferable to having it only your way. Remember, many times, instead of just knowing the answers, you first have to figure out what questions to ask to ensure success.

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 mfeuer@max-wellness.com.

A unique new book with an unorthodox, yet proven approach to achieving extraordinary success.

What does it take to grow rapidly and effectively from mind to market?

This book offers an unconventional philosophy for starting and building a business that exceeds your own expectations.

Beating the competition is never easy. That’s why it requires a benevolent dictator.

Published by John Wiley & Sons. AVAILABLE NOW! Order online now at: www.thebenevolentdictator.biz

Also available wherever books and eBooks are sold, and from Smart Business Magazine and www.SBNOnline.com. Contact Dustin S. Klein of Smart Business at (800) 988-4726 for bulk order special pricing.

Scott Kirsner spent three years immersed in the movie industry in order to write a book called “Inventing the Movies: Hollywood’s Epic Battle Between Innovation and the Status Quo, from Thomas Edison to Steve Jobs.”

He talked with directors like Francis Ford Coppola and James Cameron, editors, cinematographers, studio chiefs, producers, tech companies that sell technology into Hollywood and even actors with an interest in new technology like Morgan Freeman.

He discovered that Hollywood serves as a great case study for how any long-established, successful and self-satisfied industry responds to new technologies and new ideas.

Even when a new idea seems to have obvious merit and even when its inventor can make a strong case for it, 95 percent of the people involved in the industry fight the new idea with all their energy for as long as they possibly can until they realize it has the potential to grow their business in surprising ways.

Case in point: Within a decade of Hollywood’s fight against the Betamax video recorder, which went all the way to the Supreme Court, the studios were earning more from home video business than they were from ticket sales.

Here are several movies — all of which you’ve likely seen — each with an important backstory that innovators can learn from.

Sometimes technology needs to be just good enough, not perfect. “The Jazz Singer” will forever be remembered as Hollywood’s first talkie — even though it wasn’t among the first dozen to try to sync up the pictures on the screen with a soundtrack. But the technology that Warner Bros. banked on, developed at AT&T’s Bell Labs, was better than what came before it. It was just good enough to turn “The Jazz Singer” into a hit — especially combined with a performance from Al Jolson that practically leapt off the screen. The system still relied on phonograph records that could scratch. If the film broke and needed to be spliced back together, the entire movie would veer out of sync. The Warner Bros./AT&T technology was just good enough to start the sound revolution in Hollywood, though it didn’t endure for very long as a standard. Five years after “The Jazz Singer,” even Warner Bros. had switched over to a technology that more reliably linked the audio with the visuals.

Innovators never underestimate the importance of allies. Shot in glorious Technicolor, “Gone with the Wind” won the Best Picture Oscar in 1939, marking the start of Hollywood’s transition from black-and-white to color. But Technicolor had been working on its technology for making color movies since 1915, developing new kinds of cameras and film-processing techniques.

Like most start-ups, the company nearly ran out of money several times and had to continually hunt for new investors and allies who’d make movies using Technicolor’s technology to show how it was improving. These allies included the swashbuckler Douglas Fairbanks and Walt Disney, who won one of his first Oscars for a short cartoon made in Technicolor. Technicolor co-founder Herb Kalmus met another key ally at the racetrack at Saratoga Springs: Jock Whitney, a rich playboy who used his money to option a novel by Margaret Mitchell and help turn it into a movie starring Clark Gable and Vivien Leigh.

Innovators spot market opportunities first and chase them relentlessly. Entrepreneur Andre Blay had no connection to Hollywood, but in the mid-1970s, he was among the first to realize that home video machines like Sony’s Betamax (which sold for about $1,000 at the time) presented the potential for a new business.

He sent “cold call” letters to most of the major Hollywood studios asking them for the right to sell their movies on videotape. Only one studio, 20th Century Fox, consented, offering movies like “Butch Cassidy and the Sundance Kid.” Blay’s first ad in “TV Guide” netted his company $140,000 in revenue, and within a year, Fox acquired his company for $7.2 million in cash.

Innovators find collaborators who share their vision, and they’re prepared for things to take longer than expected. Computer graphics pioneer Ed Catmull, while he was still a graduate student at the University of Utah, was one of the first people on the planet who believed that it’d be possible to make a full-length computer-animated movie that people actually would pay to see. As he marched toward that goal, he connected with two people who bought in to his vision: John Lasseter, an ex-Disney animator, and Steve Jobs, who purchased the fledgling Pixar from George Lucas and helped develop it into a company that could stand on its own two feet, selling hardware and software while also pursuing Catmull’s ambitious, audacious goal.

Catmull admits that he thought the goal of making Pixar’s first film would take a decade — it took two. Disney eventually bought Pixar in 2006 for $7.4 billion.

As a business owner, there are many lessons to learn about innovation from the movies.

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 kawasaki@garage.com.

Left or right? Up or down? Yes or no? The human life is full of choices. We make them on a minute-by-minute, hour-by-hour, day-by-day basis. It’s what we do, how we live and move and have our being in the world.

Consider some choices you may have made in the last few years:

  • What car should you buy?
  • Should you ask her to marry you?
  • Are you ready for another baby?
  • Is this house right for you, or should you keep looking before you make an offer?
  • Who should be let go in the next round of budget cuts?
  • Will your department reach its goals this year?
  • Should you ask for a raise?
  • Is it time for your mom to enter a nursing home?
  • What do I need to do to lose weight?
  • What will you eat for dinner tonight?

Decisions are usually easier when we are only faced with two choices. Blue or red car? Two-story or ranch-style home? Slim Fast or Weight Watchers diet plan? Our brains are somehow wired better to choose between two competing choices.

It’s when we have more options that we sometimes stall, flutter or downright choke.

  • Three people from a team of eight in the department must be let go.
  • Should we marry now, when we finish college or after we find secure jobs?
  • In order to best reach our yearly goals, should we focus our attention on X, Y or Z, and how much of our remaining budget should we allocate to the project we choose?

Life is full of hard choices, and the bigger they are and the more options we have, the harder they get.

Through my years in working with individuals, groups, companies and organization, I have narrowed the questions we need to ask in order to make the right choices both in our life and in business.

Here are 3 of my best tips for making the right choice:

1. Analyze outcomes, not pros and cons.

Many of us have been taught somewhere along the way to take out a sheet of paper and divide it down the middle with a line. On one side we list the “pros” of a certain choice, on the other, the “cons.”

This old school way of making choices is time worn and tested, but I think there is a better focus: outcomes. In the end, the outcome of a choice made is what truly matters.

Working through a big decision can give us a kind of tunnel vision, where we get so focused on the immediate consequences of the decision at hand that we don’t think about the eventual outcomes we expect or desire.

When making a choice, then, it pays to take some time to consider the outcome you expect. Consider each option and ask the following questions:

  • What is the probable outcome of this choice? (This is the list we should make.)
  • What outcomes are highly unlikely? (This allows them less weight in the choice.)
  • What are the likely outcomes of not choosing this one? (These are negative outcomes.)
  • What would be the outcome of doing the exact opposite? (Play “devil’s advocate.”)

Our thinking should be in terms of long-term outcomes and not short-term pros and cons. And we should broaden our thinking to include negative outcomes. In doing so, we will find clarity and direction in making the right choice.

2. Ask why – five times.

The Five Whys are a problem-solving technique invented by Sakichi Toyoda, the founder of Toyota. When something goes wrong, you ask “why?” five times. By asking why something failed, over and over, you eventually get to the root cause.

Although developed as a problem-solving technique, the Five Whys can also help you determine whether a choice you’re considering is in line with your core values as a person and a business.

For instance:

  • Why should I take this job? It pays well and offers me a chance to grow.
  • Why is that important? Because I want to build a career and not just have a string of meaningless jobs.
  • Why? Because, I want my life to have meaning.
  • Why? So I can be happy.
  • Why? Because that’s what’s important in life.

We now see how the first two tips are interrelated. By asking the Five Whys, we learn that having meaning and being happy are desired outcomes that influence the choice made in asking the first question: Why should I take this job?

The continued relationship can be seen in revealing the third tips for making the right choice.

3. Follow your instincts.

This tip affords you the ability to work through the first two tips with a sense of personal confidence.

Why?

Because research shows that:

The conscious mind can only hold between five and nine distinct thoughts at any given time. That means that any complex problem with more than (on average) seven factors is going to overflow the conscious mind’s ability to function effectively, leading to poor choices.

Our unconscious mind is much better at juggling and working through complex problems. People who follow their instincts actually trust the work their unconscious mind has already done.

In summary:

When we allow ourselves to focus on long-term outcomes rather than short-sighted pros and cons, take on the task of asking “Why?” five different times, and trust and follow our instincts, we put ourselves in a much better position to make the right choice in any given situation in life and business.

Like anything we go through as human beings, this process takes work. Get to work and let me know how it goes.

DeLores Pressleymotivational 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 atinfo@delorespressley.com or visit her website at www.delorespressley.com

When Barry Andrews started Andrews Distributing Co. at the age of 29 in his hometown of Corpus Christi, Texas, in 1976, the company had seven employees and operated out of a 12,000-foot warehouse. That first year, the company sold 276,000 cases of beer, with Miller Brewing as its only supplier.

Fast forward through several acquisitions and an expansion of markets, and today the company serves 26 Texas counties with 1,100 employees and is the eighth-largest distributor in the country by volume -- distributing 26 million cases a year -- and the sixth-largest by revenue, says Joe Jernigan, chief financial officer of Andrews Distributing.

“We have great employees, great leadership and Barry is the hardest-working individual I’ve ever met,” says Jernigan. “He’s in the office early, he knows every employee by name and he spends time in the warehouse talking to the drivers, checking on the business. We have been very fortunate over the course of the last 16 years and 15 acquisitions to be able to precipitate a large volume growth – although a lot of it was organic, as well – at the right time and with the right people.

Smart Business spoke with Jernigan and with Andrews Distributing President Mike McGuire about how the business has grown and how its new warehouse in Allen, Texas, has aided that growth.

Why is the North Texas market a good place to do business?

We feel like North Texas, and the Dallas/Fort Worth complex are the best market in the country from a growth standpoint. It is projected that in 10 years, it will overtake Chicago as the third-largest metropolitan market in the country. We are well positioned to take advantage of that growth.

From a demographic perspective, the area is adding 160,000 people per year, or about a million every six years. As one of the top growth areas in the U.S., this is the right perfect place for us to be.

How did you settle on Allen, Texas, as the location for your new warehouse?

Our Allen location is a very robust satellite of our business. Before we opened the Allen location last year, we had nine warehouses in North Texas. The No. 1 thing that opening the Allen facility accomplished was that it drastically simplified our warehouse operations, allowing us to go from nine locations to three. That consolidation was 100 percent driven by the Allen facility and the location made it the perfect opportunity to consolidate a number of our northern, very small warehouses.

We had determined that we needed to be on the Highway 75 corridor. Our territory goes out to the Oklahoma line and 125 miles east of I-75. We started looking at a number of locations that were very interested in having us locate our satellite warehouse there. Then the gentleman assisting us in our land search introduced us to the people at the Allen Economic Development Corporation, as well as the mayor, and we established a great relationship with them.

As a result, we ended up making a deal with them and we couldn’t be happier; everything they’ve committed to they’ve followed through on, and we’ve followed through on everything we committed to. Allen is a great business community, a great community in general, and we couldn’t be more delighted with our decision. And as the population continues to spread further north, this is the perfect location for our warehouse.

The North Texas Counsel of Government has said that the junction of I-75 and I-380, three miles north of us, is going to be the epicenter of North Texas in about 15 years, which continues to validate our reason for being in Allen and which we expect will continue to contribute to our growth.

Today, we have well over 300 employees in Allen and expect to quickly grow that to 500 employees. By next year, half of our North Texas volume will be distributed out of that warehouse.

What is your ongoing relationship with the Allen Economic Development Corporation?

We continue to interact with them on an ongoing basis. Along with the land for the warehouse, we bought three tracts of land that were part of the package that we purchased from the city. People are continuing to make unsolicited offers to us on that land, we are working with the city, the mayor and the AEDC to make sure that when we sell, it is to the type of business that Allen wants as part of the community.

How is your new location working out?

We are really passionate about the company and we love the beer business. We love being a part of the community that we serve. North Texas is the best market for us to be in and when you look at what is going on in Allen, it’s an exciting time to be here.

Joe Jernigan is chief financial officer of Andrews Distributing Inc. and Mike McGuire is its president. Reach them at (214) 525-9400.

For more information about relocating to Allen, Texas, visit the Allen Economic Development Corporation at www.allentx.com or call (972) 727-0250.

Insights Economic Development is brought to you by the Allen Economic Development Corporation.

Wednesday, 01 August 2012 13:53

Why not use a book to tell your story?

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Being able to tell your story is critical in today’s fast-paced world, where cutting through the noise to be heard gets harder each day. With so many media options fighting for attention, it’s imperative to identify new channels where you can stand out.

That’s why as part of our expansion last year, we saw an opportunity to tell entrepreneurs’ stories in greater detail and share lessons learned by launching a book division.

Our book division is unlike traditional publishers, because we do all the work for you. We develop the story and outline, conduct the interviews with the author and other contributors, and then write the book and handle all of the other elements through publication of an e-book and hardback editions.

The time commitment from you is minimal. Once the story is determined, we will conduct a series of short interviews to get the information we need to write the book. You approve everything that goes into the story and have final say on every aspect of the project. We help you take an idea for a book and turn it into a reality that you can share with others.

As an example, last year, we worked with auto dealers Rick and Rita Case to produce “Our Customers, Our Friends.” In the book, the Cases lay out their theory that the secret to successful retail sales is through building long-lasting relationships with customers and treating them as you would your best friend.

Whether your goal is to use a book as a business card for your organization by sharing knowledge with others or to further a cause and help raise awareness for something you believe in, we work with our author-entrepreneurs to identify what makes them unique and what insight they can share with others. We also build an author’s website and set up social media channels to help them promote the book. And, we’ve recently established an authors’ speakers’ bureau that will help extend the reach of sharing that entrepreneur’s knowledge across the national footprint of Smart Business Network.

So far this year, we have eight books in various stages of production. Among them are books for the CEOs of three publicly traded companies on topics ranging from mergers and acquisitions to building sustainable businesses to how to conduct successful turnarounds. We’re also publishing books that introduce exciting new business theories, as well as one that explains how to lead with a philosophy of giving back to the community.

What direction your book takes is up to you. It can tell the story of how your business started small and grew into what it is today, or it can explain the details of what you see as the keys to being successful in business.

Breaking through the clutter of information is tricky, and writing a book is one way you can make yourself heard. It’s also a great way to explain your philosophies to employees, customers and your peers.

There’s a widespread belief that everyone has at least one book within them. In the business world, that’s even truer. If you think that’s you, we’d be happy to help you turn your ideas into reality.

If you are interested in learning more about publishing a book, please contact our publisher, Dustin Klein, at dsklein@sbnonline.com or (440) 250-7026.

Fred Koury is president and CEO of Smart Business Network Inc. Reach him with your comments at (800) 988-4726 or fkoury@sbnonline.com.

Wednesday, 01 August 2012 10:32

Why smart companies do dumb things

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Not a day goes by when I don’t ask myself, “Why do smart companies do such dumb things?”

A sweeping answer is that companies are run by smart people, and smart people do dumb things. However, when smart people assemble in companies, they are still capable of doing dumb, if not even dumber, things. Here are some reasons why.

Consensus. When it comes to doing dumb things, the sum of the parts is less than the whole. Throwing more minds at the problem means more data, more perspectives, more possible solutions, more critiques of these solutions and more minds (and hands) implementing the solution, right?

Possibly, but there’s also the downside of more people: Once consensus starts to build, it’s harder to alter a decision. It’s one thing to argue against a few people; it’s much more difficult to argue against the wisdom of a crowd. Individuals who hold out, question or disagree are labeled as clueless, uncooperative and not team players.

Conviction. Consensus rears its ugly head during the decision-making process. The situation can get worse once implementation occurs because the organization marches along with a firm belief in what it’s doing. At that point, a decision takes on a sacred life of its own, and a company cannot see flaws. Conviction is not inherently bad, and truthfully, it’s an important component of success. The trick is to combine conviction with open eyes and open minds to reduce the likelihood of having a conviction in the wrong thing.

Experts. If there’s anything smart people worship it is other smart people. It’s tough to be strong enough to not defer to an expert. Most experts have a tough time accepting surprises that are outside of their comfort zone.

Good news. A company is constantly assaulted by its competition, customers, governments and schmexperts (schmucks + experts). Faced with this onslaught, good news is an addictive, illegal and dangerous drug. It makes you crave more good news, and you refuse to communicate bad news up the chain of command. Ultimately, it may even make you refuse to hear bad news at all.

Lofty ends. Lofty ends can justify all sorts of weird and inappropriate means. Look no further than the quests for peace that produce mayhem and violence. Or, the desire to make a profit (something that is genuinely good for shareholders and customers) that warps a company’s code of ethics even though the company is made up of smart, honest people. Companies trying to achieve a lofty goal can start believing that any means to achieve it is OK.

So what can you do to prevent doing dumb things?

• Say, believe and act in a way that convinces employees that differences of opinion and diversity of thoughts are good things. Frankly, a couple of curmudgeons is a good thing for a company.

• Don’t be in a rush to meet consensus. In particular CEOs should not rush into a decision even though the image of decisiveness is so seductive.

• Spell things out. It’s not enough to say, “Plug this leak in our company,” and assume that it will be done legally. You should say, “Plug this leak in our company by using only legal, ethical and reasonable methods.” That’s when you’re done.

• Move the crowns. When employees go around saying, “We need to do it this way because Bill/Steve/Carly/Larry wants it this way,” you’re in trouble. It means that employees are making decisions based on what they think will make kings and queens happy, as opposed to what’s right for the customer, employees or shareholders. Good CEOs put the crown on the heads of customers, not themselves.

• Restrict the use of experts to narrow areas. Never use experts to create your product roadmap or marketing plans unless you want MBAs who have never run anything larger than a school snack bar to decide your fate.

• Ask for bad news. Don’t assume it will find you — you have to find it. You should allocate a time that’s specifically for communicating bad news.

• Don’t shoot the messenger who brings the bad news unless he or she caused it.

• And finally, don’t reward the messenger who brings good news unless he or she caused it.

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 10 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 kawasaki@garage.com.

We’ve all seen it before, where co-workers in a company recognize a problem performer, but these same people can’t understand why the boss hasn’t yet taken action or has taken so long to come to grips with the issue.

Conversely, as the boss, how many times have you made what you considered to be an extremely difficult personnel decision and have done so only after protracted analysis, a fair measure of agony and more than an adequate amount of second guessing yourself?

Case in point: One of your top managers has hit the skids, and in your gut, you know that a change is needed. Fearing the worst, you play over and over in your mind the potential negative consequences that could occur if you were to fire this individual. Finally, after all else fails, you pull the trigger and decide to part ways with the onetime A player. Before you tell associates, you rehearse in your mind how you will explain your decision. Once you gather your lieutenants together and finally utter the previously unthinkable, the reaction is almost a unanimous, “What took you so long?”

After you breathe a sigh of relief, your team members start making not-so-subtle comments suggesting that they weren’t surprised, followed by a litany of examples of why your now fallen superstar wasn’t hacking it.

This begs a bigger question: Were you really the last one to realize that there was a problem? Furthermore, did it actually take you too long to make that final decision that, as they say in spy novels, this person was “beyond salvage”?

This provides a good opportunity for introspective analysis. The end result just might help you understand that you were not the last to know, but in fact, you may have been the first to recognize what was looming on the horizon.

Virtually every leader has to rely on experience, combined with instincts, to decide when to either cut and run or try to rectify a problem. Being an executive requires being a very good teacher. When a pupil is not measuring up, the first question is how can you help and what can you do to improve a person’s performance? Most everyone at one point in his or her career hits a rough spot, and with a bit of mentoring, a fair number of wayward employees can turn the corner and again blossom. Also, it’s more economical to at least try to turn someone around after investing time and money in developing the individual. After a certain period, the employee has gained valuable empirical knowledge about the ins and outs of the company and, just maybe, a little extra coaching can make the difference.

However, in some situations, your optimism for achieving Mother Teresa status through patient mentoring wanes, and you begin to come to grips with the fact that it’s time for a change. You then map out your what-if scenarios. Not only one but several. You ruminate over your game plan until you have the best probable solution locked and loaded in your mind for that moment when you have concluded that you’ve run out of road.

Most times, trying yet failing is not a bad thing; actually, it is a good thing and the way a responsible leader must approach an important human resource decision. You can never forget that you’re dealing with the life and livelihood of a person and his or her family, which can be adversely affected by the decision. Many top employees who veer off course and don’t work out were, at one time, effective and loyal contributors to the organization. It’s mandatory to make the effort not only to try to stem the negative tide of poor performance, but also to develop an alternative replacement and transition strategy. This takes time and can be a very solitary task depending on the level of the person to be replaced.

In reality, the boss knows in his heart of hearts before most, if not all, others when something ultimately has to give. Being the boss requires making the difficult decisions after meaningful deliberation and then living with them and making them work.

The boss the last to know? Highly unlikely. Instead, he probably is the first to know when the time to act was finally right.

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 mfeuer@max-wellness.com.

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MyCorporation has always reminded me of a Russian nesting doll — it is a business that helps other business owners start their business. Along with being a tad complicated to explain, this puts me in a unique position as its CEO. I have to be an expert in starting a business, which is an inherently risky venture. I’ve seen great ideas crumble and silly concepts flourish.

I’ve seen the most dedicated become beaten down and weary after only a few days while those who were at first noncommittal to the whole “running a business thing” grasp and cling to their company through every hurdle and hardship.

So when people ask me for my No. 1 piece of advice, all I can say is “protect yourself.” You may be able to influence sales, marketing, reviews and customer satisfaction, but you cannot control them. The amount of protection you give yourself and your business is something you can control. So why would you skimp on something as rudimentary as protecting your intellectual property?

Of course I know exactly why so many people skip filing trademarks and copyrights. It costs money and can be a bit complicated. New business owners keep track of every single cent that they spend — I know I did. You don’t know if you’ll even be able to break even when you first start out, so why would you want to send a fat check to the United States Patent and Trademark Office so early on?

Well, you should. I’ve had plenty of clients who have failed to protect the trademark or brand they spent so much time building. They always say the same thing — that once they are making more money, they’ll think about filling out the paperwork. Then, out of the blue, a competitor is using their intellectual property. And that same competitor has filled out paperwork with the USPTO.

It may sound like a campfire story, but it really does happen. We aren’t talking about million-dollar corporate behemoths here. This kind of thing happens between the smaller guys whether it’s two tow-truck drivers in the same town, a couple of restaurant chains or a pair of small Internet start-ups.

Typically, no one involved has the money to bring an infringer to court and prove that they were the first ones to use that particular image or name. So the infringer gets the trademark protection and the infringed has to start from scratch. It’s annoying, and a bit underhanded, but it happens.

Trademarks and copyrights are a lot like insurance — everything is fine until you need it. Then, if you don’t have it, the costs are astronomically higher than what you would have spent on the policy in the first place. “But it won’t happen to me,” you may say, scoffing at the prospect of filing protection for your little brand.

Maybe it won’t, but what if it did? Would you be willing to put as much blood, sweat and tears into building the same level of respect and trust for your new brand? It might not even be a question of would you — it might be one of could you.

We sometimes forget, or choose to block out, how much effort it took to really get our businesses started. It takes a lot out of a person, and I’m not sure if I’d be able to devote that much of my focus and energy again if the original object of my efforts was stolen.

So here is my mantra, repeated to every new business owner seeking my sage wisdom: Protect yourself early and thoroughly. Don’t wait until it is too late, or you have a bit more money or whatever other excuses you might have come up with.

Protect your business, your intellectual property and your future sanity now.

Deborah Sweeney is the CEO of MyCorporation, an online filing services company that specializes in incorporations and LLCs. Find her online at mycorporation.com and on Twitter @deborahsweeney and @mycorporation.

Yogurtland has been a frozen dairy-powered rocket for Phillip Chang. The president and CEO of Yogurtland Franchising Inc. founded the chain of self-serve frozen yogurt bars in 2006, and in the six years since, has grown the company to more than 170 locations, owned by more than 100 franchisees and employing more than 2,100.

But when on a stratospheric trajectory sometimes things don't always go according to the script.

Which is why, several years ago, Chang threw out the script and began concentrating on the actors in his company.

"Before then, even though our stores performed pretty well, some people's behavior didn’t reflect the culture we wanted to have," Chang says. "We didn't see enough of the honesty side, the respect for each other, the desire to help each other."

Chang quickly realized that if he were going to build a stable culture that embodied high ethical and moral standards, he needed to find the people first. So he started to shift how he and his leadership team recruited, what they valued in prospective employees and franchisees, and what constituted a great hire.

In short, Chang began focusing on candidates' hearts first and their heads second.

"When the company started, I had hired too fast, and because of that, some people had a lot of experience as far as the technical side of things, but they didn't have high moral standards," he says. "So I started looking at this in terms of two areas. One was the culture, in terms of the level of ethics and honesty, and the other side was their technical experience.

"I looked at how each candidate performed in both areas, but I set my bar very high on the ethical side and was more generous on the technical side. You can teach technical skills, but you can't really teach ethics and morals."

Since refashioning the company's recruiting and hiring practices, Chang says it has had a profound impact on the culture of the company.

"It has been big for us," he says. "We now look at our company more as a family."

Ask the right questions

If establishing your ideal culture starts with hiring the best people, then hiring the best people starts with asking the best possible questions during the interview process.

Chang wanted to develop and nurture a culture that embraces high ethical and moral standards, but also promoted the idea that Yogurtland behaves something like a large extended family.

Though many company heads talk about the family atmosphere that exists in their companies, making the leap from professional colleague to something more familiar is difficult, and one that can't happen without close involvement from upper management.

Chang wanted a constructive bond to develop among the people in Yogurtland's Anaheim corporate office, so he started by developing bonds between himself and his team members. He developed relationships with his people in which he got to know the significant things happening in their personal lives.

If there was a way Chang could leverage Yogurtland's resources to help an employee realize a significant life goal, he wanted to help.

"In our situation, I think it’s important to look at a company as family members," Chang says. "When you have a parent, sister, brother, and you're working together, you're thinking about the ways you can help them and make their life better. You're asking 'How can I teach them to fish?' That's why, maybe you don't want to just hand them a prize, but you want to figure out a way that you can help them realize the dreams they have for their own lives."

One of the first questions Chang asks a job candidate has nothing to do with the lines on their resume. It has everything to do with trying to learn what really makes the candidate get out of bed each morning.

"For every single person I interview, I ask them what is their ultimate goal in life," he says. "That gets them to think deeply and reveal some truths about who they really are. Their goal can be relevant or irrelevant to our company, but I want to know what their goal is. If we hire them, I want to customize a path for their dreams.

"Maybe someone wants to buy a house for their mom. It really has nothing to do with us, but we look at the numbers, we put together our collective wisdom and try to see a way this person can achieve their goal. If that person can finally buy a house for their mom after so many years, that is very motivating for them.

"We see it as something we're not obligated to help with, but if you truly view your people as family members, as a brother or sister, that is my role. If they see me and those of us in the company going above and beyond to help them, they start to see and believe that we act as a family."

Finding those life catalysts is a critical component of motivating employees at their jobs. Employees do come to work each day for a paycheck. Without income, they don't pay their mortgages or utilities, don't make car payments and don't buy groceries. But the sum total of what constitutes gainful employment doesn’t begin and end solely with what ends up in each employee's bank account every two weeks.

People want to work at an organization where they can make a lasting difference. What defines "lasting difference" changes from person to person, but the greater need is always there. As the leader, it's up to you to ask the questions, both of your current and prospective future employees, and find out what truly motivates them.

"In a lot of cases, I don't think financial compensation is the real motivation for people," Chang says. "When they hear the company is trying to achieve something beyond just the numbers and financials, when they see that we come together as a company, we reach out and help each other achieve our goals so that we can achieve our overall company goals, that is a common motivation where people see we're not just out to make a profit. We don't come to the office each day just to make money. It's more than that."

Perform daily maintenance

It's easy to project enthusiasm about a new strategy or a culture shift at the outset, when everything is new and exciting. But how about a month after, or six months after, or a year after?

At some point, you will leave behind the rush of blazing new trails and exploring new frontiers, and sustaining what you worked so hard to develop and roll out will be a matter of daily maintenance.

At Yogurtland, Chang considers his company’s cultural conversion a success. The atmosphere around the company's corporate offices — and by extension, at franchise locations — is based on Chang’s vision of a company that behaves as an extended family. It is a commonplace occurrence for Yogurtland associates to build and sustain meaningful and fruitful interpersonal relationships.

But if Chang were to rest on his laurels and consider the mission accomplished, he would run the risk of allowing his culture to backslide into the bad habits he spent several years eradicating. That's why he makes sure to create regular interaction points between him and his team, so that he can continue to reinforce the principles he introduced at the outset of the company's culture shift.

The company's rapid growth adds an extra layer of complexity to the equation.

"Right now, we have a corporate office of 40 and it is already difficult to reach to all levels," Chang says. "The only way is to remain vigilant about communication. In our regularly scheduled meetings, what we're discussing isn't just about simply store operations or the numbers we are trying to achieve. We discuss more than that."

Chang tries to address technical issues quickly so that he can spend more time reinforcing the culture. Whenever possible, he wants common-sense, uncomplicated solutions to issues involving the company's infrastructure. Since maintaining a great culture is hard work, he wants the nuts and bolts of running his company to be as simple as possible.

"When we need to visit the technical side of things, we can be pretty quick in figuring out what the best solution could be, and then put that in a memo to whoever it concerns," Chang says. "That way, it's in an e-mail, everybody reads the e-mail, and if the subject needs to be addressed in one of our meetings, we are all prepared beforehand. That hopefully leaves us more time to address our culture and how we are putting ideas together for the future. The meetings are where we really dissect what is going to help the company’s future. So we want to spend a lot of time on those big-picture, conceptual ideas."

Don't compromise

Chang says the new culture at Yogurtland has affected the way he runs the business on a fundamental level. Like most CEOs, Chang used to focus on strategic planning before anything else. Everything — from hiring to culture to job descriptions — stemmed from the strategic plan laid down by management.

But as Chang advanced deeper into his new philosophy of focusing on people first, he discovered talent was his most important asset, and motivating that talent was his most critical task. Now, he values talented people who embrace the culture far more than he values strict adherence to any organizational strategy.

Yogurtland still has an overall direction and goals, but the method by which those goals are achieved is now largely up to input from his team.

It is something that requires a level of adaptability that might extend beyond the comfort level of some business heads. But Chang views it as an essential part of his leadership philosophy. He'll compromise on how something gets done, but he won't compromise on who does it.

"Typical company leaders, they will do strategic planning and everything related to that first, and then try to fill out the team by putting people in the right positions," Chang says. "We do it the other way around. As I've said, I find the right people first. That takes a level of risk, because sometimes you find a really great person and you know right away where they're going to fit in the organization.

"That's where it gets kind of strange, because what I've learned is that if I find the right person who fits the culture, someone who is honest, humble, receptive, confident and wise, that is where you really can't compromise. You can be pretty generous regarding how you hire for technical skills. If you've hired someone who is smart and receptive, they can catch up their skills fairly quickly. That is why you find the person first, then do the planning.

"If I were starting a company from scratch again, I now know that is how I would do it."

How to reach: Yogurtland Franchising Inc., (714) 939-7737 or www.yogurt-land.com

The Chang file

Born: Seoul, South Korea

Education: B.S. in mathematics, Sogang University

What is the best business lesson you’ve learned?

One thing that has impacted me throughout my career, and what I keep emphasizing to my people, is that you need to surround yourself with the right people. You need the right employees, the right partners and the right people around you in everything you do.

What traits or skills are essential for a business leader?

The ability to build a great team. You need to have the ability along the technical lines of what it takes to run a business, but you can’t go anywhere without a great team. And that comes back to how you communicate with people and share your goals.

Chang on the CEO’s role in sustaining the culture: As the company has grown, I’ve tried to set myself as more of a cultural leader, rather than an operations leader. I try to focus more on the bigger goals and being a good role model, demonstrating our cultural principles by example — honesty, high morals and so forth. As the leader, you are constantly watched by everyone, and they have to see me embody those core values at every turn, because they are going to follow my example.