How Purchasing Power enables workers to buy big-ticket items responsibly

Richard Carrano, President and CEO, Purchasing Power

Purchasing Power, an e-commerce company that offers a program enabling its clients’ employees to purchase computers and home appliances via payroll deduction, was founded on the belief that people who can’t afford to pay for expensive items up front should have the opportunity to make such purchases responsibly without incurring high interest rates or prolonged payment periods.

Led by President and CEO Richard Carrano, Purchasing Power is in business to give people a better way to buy by providing a responsible alternative to other consumer financing options, but it is the “why” that drives the company. Purchasing Power is committed to its service and its customers.

The company’s phenomenal growth in the past four years has been driven by how it listens to its customers: what’s good for Purchasing Power’s customers is good for the company.

Despite Purchasing Power’s fast growth, all its customers are treated as VIPs with opportunities to receive personal product mailers, promotions and discounts. Customers who enjoy Purchasing Power’s program can share their experiences with their co-workers by participating in the company’s referral program, which rewards every customer who refers new customers to Purchasing Power with a gift card.

Longstanding customers have been extended larger spending availability, personalized policies and white-glove service. And Purchasing Power is in the process of developing a loyalty program to reward more frequent users of its program with additional benefits.

Dave Van Nostrand of Wappinger Falls, N.Y., has been a Purchasing Power customer since 2009 and has placed multiple orders with the company. “I’ve had so many great experiences with Purchasing Power that it’s hard to narrow it down, but one that stands out the most would be when I ordered my son’s HP laptop,” he says. “They were very helpful and informative about the product. They just do everything right. I am a customer for life.”

How to reach: Purchasing Power, (404) 609-5100 or www.purchasingpower.com

Tom Nies: Entrepreneurial road map

Tom Nies, Founder & CEO, Cincom

“You’ve got to be daring! You’ve got to be first! You’ve got to be different!”

Ray Kroc, the man who made McDonald’s what it is today, once said that to an audience of entrepreneurs. It can be considered one of the unique value propositions of McDonald’s. Kroc took a small chain of drive-in restaurants and exploded the business into a highly successful national icon. Using his own quote as a road map, you can see his path to success.

Kroc’s McDonald’s began with hamburgers, then added french fries and a beverage to turn it into a meal. When imitators began to gain traction in the marketplace, McDonald’s introduced the sesame seed bun to differentiate its burger. In the 1980s, it dared its competitors to keep up by introducing the Egg McMuffin. McDonald’s also captured the children’s audience with Ronald McDonald, play places in stores and the Happy Meal with a toy.

In short, the 1.5-oz. hamburger that McDonald’s began with demanded a lot of superb marketing to generate preference and brand development.

A new competitor enters the market

McDonald’s isn’t the only fast-food brand specializing in hamburgers that can be first, daring and different, however. In 1969, 15 years after Kroc joined McDonald’s and began to position it as the market leader in the industry, Dave Thomas founded Wendy’s.

While similar to other fast-food restaurants in the market, Wendy’s dared to be different by offering a 4-oz. square hamburger patty instead of the standard 1.5-oz. round burger offered by McDonald’s and some other competitors.

Wendy’s also offered 11 different choices of toppings and sides instead of the standard french fries. It customized each hamburger as requested, with all additions — including the meat — being fresh daily.

It all came together beautifully and the upstart Wendy’s grew rapidly against much larger and already very well-entrenched competitors.

Why does it matter?

While the story of two fast-food giants seems irrelevant to many businesses outside the food industry, all of this information is 100 percent applicable to any industry.

Every entrepreneur strives to be first, daring and different with his or her business. Not all of us can be the first in an industry, but with a little creative thinking, we can all add a new first to an industry.

Reposition competitors so they work for you

Challengers in a marketplace can reposition dominant market leaders, but we must understand what we are trying to do. We must have a unique value proposition that is compelling, and we must do those things well if we are to be successful.

If Dave Thomas had decided to offer the same experience and choices as McDonald’s, Wendy’s might never have left Dublin, Ohio. Instead, he creatively repositioned Kroc’s offerings from the most popular burger to a small amount of meat with one phrase in an advertisement. Entrepreneurs need to always be thinking of how they can ask, “Where’s the beef?” of their competitors.

Focus on the customer

The Achilles ’ heel of most dominant providers is that with success, they inevitably move from an emphasis on trying to sell what the customer wants to buy to using their marketing muscle to try to sell the customer what they want to offer.

The fast-food world can try to throw its weight around when introducing a new product, but it seldom lasts if it is not something a consumer wants to buy. This is dangerous because customers have so many fast-food options that if a certain provider isn’t focused on what they want, someone else will be. <<

Thomas M. Nies is the founder and CEO of Cincom Systems Inc. Since its founding in 1968, Cincom has matured into one of the largest international, independent software companies in the world. Cincom’s client base spans communications, financial services, education, government, manufacturing, retail, healthcare and insurance. Reach him at tomnies.cincom.com/about/

Andy Kanefield – Why how you feel and act matters so much in the workplace

Andy Kanefield, founder, Dialect Inc.

Andy Kanefield, founder, Dialect Inc.

Your intellect may be confused, but your emotions will never lie to you.

■ Roger Ebert, film critic

The 2012 State of St. Louis Workforce Report says that the No. 1 shortcoming of recent hires is the “lack of communication or interpersonal skills.” Also in the top 10 were a “lack of teamwork and collaboration” and “lack of willingness and ability to learn.”

Commissioned by Workforce Solutions Group of St. Louis Community College and conducted in partnership with the Missouri Economic Research and Information Center, the report seems to suggest that elements of what we often call emotional intelligence are valued but lacking in recent hires.

Why is this important to leaders? There are several reasons.

First, it should give us pause to examine how well we as leaders stack up. Are we exhibiting the qualities we deem lacking in others?

Secondly, it suggests that we should seriously think about whether or not these are the talent deficits we see in our business. If these are the deficits, what will we do about them? How do our attraction efforts need to change? How do our employee development initiatives need to change?

What is emotional intelligence?

In “Primal Leadership: Learning to Lead with Emotional Intelligence” by Daniel Goleman, Richard Boyatzis and Annie McKee, the authors’ definition of “how leaders handle themselves and their relationships” is expanded through the explanation of four domains of emotional intelligence and their associated competencies.

At this point, some leaders may think that while this is interesting, they still just need to hire smart leaders who want to work hard.

Fair enough, as we certainly need to do that. But, the authors suggest that emotional intelligence “contributes 80 to 90 percent of the competencies that distinguish outstanding from average leaders — and sometimes more.”

They admit that this is a “rule of thumb” and a precise measure is dependent on many factors. But we know, as leaders, that we’ve seen great ideas flounder or die because advocates weren’t aware of how they were coming across or hadn’t built up the people capital necessary to support the idea.

Regardless of the ratios involved, the authors are onto something: Emotional intelligence is a significant aspect of leadership.

So, how does one incorporate recognition of the importance of emotional intelligence into leadership development efforts? If a leader needs to develop an aspect of emotional intelligence, is it even possible for that person to change?

What are emotional styles?

Dr. Richard J. Davidson and Sharon Begley, authors of “The Emotional Life of Your Brain: How Its Unique Patterns Affect the Way You Think, Feel, and Live — and How You Can Change Them,” suggest that it is possible for people to adapt certain emotional patterns.

Using his 30 years of research in affective neuroscience, Davidson has identified six “emotional styles.”

Resilience: How rapidly or slowly does one recover from adversity?

Outlook: How long does positive emotion persist following a joyful event?

Social Intuition:  How accurate is one in detecting the non-verbal social cues of others?

Context: How well do you regulate your emotions to take your context into account?

Self-Awareness: How aware are you of bodily signals that constitute emotion?

Attention: How focused are you?

Even a cursory review of the six emotional styles will lead one to see connections to important dimensions of emotional intelligence. What if you could help your team members bounce back more quickly from setbacks? What if you could keep a positive attitude that helps keep the troops motivated and promotes creativity? How could you become either more focused or less single-minded? Each point should have relevance to you. Would that be worth some time and effort for you to explore?

Andy Kanefield is the founder of Dialect Inc. and co-author of “Uncommon Sense: One CEO’s Tale of Getting in Sync.” Dialect helps organizations improve alignment and translation of organizational identity. To explore how to use the principles of neuroscience to promote better organizational alignment, you may reach Andy at (314) 863-4400 or [email protected]

Becoming a change monster

Randy Dobbs, Business Leadership Consultant

Randy Dobbs advocates that CEOs become “change monsters,” a mythical, business beast capable of transforming even the direst business. To rejuvenate and transform a company, you can’t be intimidated by change or what may be necessary to right the ship.

As the former president and CEO of U.S. Investigations Services Inc., Philips Medical Systems North America and GE Capital, IT Solutions, Dobbs, who is now a business leadership consultant, knows what it takes to transform a company.

“My view is that transformational leadership is the key ingredient for organizational success,” Dobbs says. “Most of the businesses that I’ve run have had two very common ingredients — the first one is they are missing their financial portfolio significantly; the second one is they’ve had organizational chaos.”

As the author of “Transformational Leadership: A Blue Print for Real Organization Change,” Dobbs recently spoke at the ASLON Leadership Forum in Cleveland where he discussed advice from his book and his career for best ways CEOs can be transformational leaders.

Find your success factors

To understand how to change your business, you have to know where your success factors lie. The inverted triangle is a great tool for understanding the value of the customer and how your company serves them.

“When I go in to talk to CEOs of $100 million, $500 million or $25 million companies, the first thing I ask them is, ‘What are your success factors in your business? What are your business objectives?’” Dobbs says. “They say, ‘Well, I want to grow revenue 10 percent this year. I want EBIDTA to grow faster than my revenue. I want to get my growth’s margin up three points.’

“I look at them and say, ‘That’s not a business objective. That’s an outcome.’ Your success factors in your business are those things you want to do to drive that outcome. It could be that I want to get premium price for my product in the market. I want to grow my market share, and I want to take a share within my geography. I want to go into adjacent markets. I want to leverage my existing assets. Those are success factors.”

When you define what that success factor is, you then have to look at your strategy for accomplishing that goal.

“Even if businesses have a success factor, what I find is they don’t have strategy,” he says. “At GE, we used to have five-year plans for strategy. Jack [Welch] came in and blew that up. He said, ‘Don’t have a strategy more than 18 months.’ The world changes too much in 18 months. As every business designs and defines its success factors, it needs to have an 18- to 24-month strategy.”

If you identify your success factors and develop the right strategy, you should find gaps within your business.

“There should be a gap between where you were and the strategy it takes to get there,” he says. “If you don’t have a gap when you get through that process, then you don’t have a good plan. You’re doing something that you really haven’t defined well enough in your business solution.”

Drive change

To close this gap you have to use the sides of the inverted triangle — people and processes. Dobbs uses Southwest Airlines as an example to prove his point.

“They were trying to be the low-cost provider in air transportation and they were trying to be the fastest and the simplest,” he says. “They built a strategy that said, ‘We’ll have a spoke and a hub, we’ll use the same airlines, we’ll be very quick with maintenance, we’ll have a quick turnaround time, and we won’t assign seats.’

“With the right processes and the right people and through all this financial turmoil, they’re the only airline to remain profitable. They had good business success factors, they had a great strategy and they continue to work on processes and executing.”

Think about this relative to your business. This is where you have to be a change monster in order to truly make transformation happen.

“To close the gap you have to be a change monster, and that’s really what transformation is all about,” he says. “A good transformational leader is somebody that has overcome one failure and learned, one failure and learned and kept moving through life.”

You have to get people to a comfort level where if you’re going to transform, they believe in the leader to do the right thing.

“What really drives transformational leadership is that ability to never give up and to see where you’re going,” Dobbs says.

“And be that leader and take the organization there when everybody is standing against you and saying that it can’t be done and you have the belief that it can and you keep driving to that point and keep having that vision and keep overcoming those failures.”

Create a transformational environment

Dobbs notes that five key things are important to create a transformational leadership environment.

“No. 1 is building a culture of change,” Dobbs says. “Businesses fail for two reasons: They fail early on because they run out of cash or they fail long-term because of their inability to change. No. 2, you’ve got to improve and grow the spirit of the team or the esprit de corps.

“No. 3, you have to have very strong communications. No one wants to hear about what happened yesterday. They want to hear about where we were and where we’re going.

“No. 4 is you have to change the financial results. You can be a great speaker, you can build a great team, you can have a wonderful environment of change, but at the end of the day, the scoreboard is going to tell the real story about you and that’s how you’re going to get evaluated.

“The last thing is you’ve got to build a cadre of transformational leaders who can run that business when you’re gone.”

Building a culture of change starts with recognizing your current culture and communicating how you plan to change its structure and character.

“One of the critical things is to create a shared need,” he says. “That’s why communication is so important. Most of the people in your organization, until you explain to them why you need to change, don’t get it. When they start to get it, they’re afraid of it.

“You have to continually develop that movie in your head where this business is going. Know where you’re going to be in 18 months and start selling it every day. You have to keep selling it and selling it and selling it until, all of a sudden, people just get it.”

Driving transformation starts with people and processes on top of a vision, mission and supporting strategies. Being a change monster will help you close the gap of where you want to go.

“As a transformational leader you wear a lot of hats,” Dobbs says. “At the end of the day, your primary job as a transformational leader is to be a change agent. You are that change monster and that’s how people see you if you really want to transform.

“For me, there is no better feeling in the world for a true leader than to really try to change and see a business transform and see the people in it be successful and then see the financial results be successful.”

How to reach: Randy Dobbs, www.dobbsleadership.com or [email protected]

Donna Rae Smith: Reading the signals

Donna Rae Smith, founder and CEO, Bright Side Inc.

A client called me in a heightened state of frustration. Her business group recently made major decisions regarding strategy and future direction. While she was enthusiastic about what lay ahead, her team members weren’t. They were exhibiting signs of dissatisfaction and sowing the seeds of subversion. She needed to act quickly, but she didn’t know how.

Without knowing anything more, I could already guess the root of the problem: the team hadn’t felt included in the strategy-level decision-making. As I dug deeper, my suspicions were confirmed. Leadership had a history of asking for input and then stifling open and honest dialogue.

Another client recently went through a major restructuring. In the process, the company left employees in the dark by failing to communicate what was happening and why. By the time the client called Bright Side, it was facing a debilitating backlash. 

Whether it’s leadership consistently disregarding (or failing to solicit) employee feedback or neglecting to communicate significant changes — the result is always the same: Employees end up feeling disrespected and devalued. Resentment simmers and eventually boils over.

Don’t misunderstand me. I know that not every decision can be subject to employee feedback. But, all too often, leadership loses sight of the organization’s most valued asset: its people. With a single-minded focus on the bottom line, leaders make the mistake of treating employees like automatons rather than people.

In the rush of getting the job done, leaders must remember these core truths: All people want to feel valued and respected for the work they do, to know that their contributions matter and to feel heard. When we overlook these principles, employees become disheartened, discouraged and disengaged. One way or another, the discontent manifests itself and everyone suffers.

The solution is to stay connected. Stay connected to your employees daily by cultivating honest person-to-person (rather than person-to-object) relationships, where respect and communication are the cornerstones. Demonstrate through your words and your actions that you value their work, that their input matters and that you believe in transparency. That doesn’t mean, of course, that you won’t at times make decisions that they don’t agree with. It means that the conversation will have happened — they’ll have spoken, you’ll have listened, and no one will be in the dark.   

Create opportunities daily to demonstrate that employee feedback is valued. How? For starters, listen more and talk less. A good way to do that is to ask more questions. If you don’t like what you hear, don’t get defensive. A defensive reaction will only shut the conversation down and signal that you aren’t really interested in what others have to say. Instead, ask more questions to clarify and don’t take disagreement personally.

Intentionally seek out viewpoints that are different than your own. If you only talk to people who agree with you or tell you what you want to hear, then you’ll create a false sense of reality.

Lastly, be transparent. I can’t emphasize this enough. So many problems arise when leaders fail to be transparent in their decision-making. Don’t leave people guessing about important matters that impact them.

Resolve to actively practice these behaviors in meetings and routine interactions. Ask team members to follow suit. By doing so, you’ll demonstrate your willingness to learn and to be engaged. Morale will improve and you’ll head off unnecessary revolts and insurrections. <<

Donna Rae Smith is a guest blogger for Smart Business. She is the founder and CEO of Bright Side Inc., a transformational change catalyst company that has partnered with more than 250 of the world’s most influential companies. For more information, please visit www.bright-side.com or contact Donna Rae Smith at [email protected]

Exploring real-world opportunities

On Oct. 30-31, more than 700 advanced energy industry leaders will convene at the Greater Columbus Convention Center for Ohio’s first statewide Advanced Energy B2B Conference & Expo. The event, produced by NorTech and presented by Advanced Energy Economy Ohio, is the largest conference and exhibition focused on the companies, technologies and researchers driving progress in Ohio’s advanced energy industry.

The business-to-business expo is also geared toward companies interested in entering the industry, supply chain manufacturers with an interest in advanced energy opportunities, national collaborators and value chain partners interested in doing business in Ohio or with Ohio partners.

“We are at a critical point in the growth and evolution of Ohio’s advanced energy economy,” says Dave Karpinski, vice president of NorTech. “The Advanced Energy B2B Conference & Expo provides a critical platform to share ideas for developing new, innovative advanced energy technologies, network with leading industry decision-makers and capitalize on common synergies for future business opportunities.”

Advanced Energy B2B 2012 builds on the success of Advanced Energy B2B 2011, which was geographically focused in Northeast Ohio and attracted more than 450 attendees. As a result, the footprint for Advanced Energy B2B 2012 has been expanded to bring together advanced energy stakeholders from across Ohio. Developing connections that will accelerate the growth of the state’s advanced energy industry is a key priority of the event. 

“It is important advanced energy companies, researchers and investors convene to discuss opportunities and challenges in the industry, as well as solutions to foster innovation and economic growth,” said Michelle Murcia, executive director of Advanced Energy Economy Ohio. “We have assembled industry-leading experts from across Ohio and the nation to share their insight and knowledge with conference attendees as they formulate their own business strategies for the advanced energy market.”

The program, which includes a slate of state, national advanced energy experts and thought leaders, will highlight Ohio’s strengths in several major sectors of advanced energy as well as policy, business and regulatory issues that could impact the industry in Ohio. Compelling examples of success stories and best practices in several sectors or projects will also be featured.

Ohio’s shale play will be featured as part of the B2B program. Utica Shale in Ohio is believed to hold a significant amount of “wet gas,” which contains natural gas liquids that are used by makers of plastics and chemicals. Experts will explore downstream opportunities for the polymer and chemical industries as a result of the shale gas boom, the economic effects of shale gas and if it will be revolutionary or evolutionary in nature.

Energy efficiency is also another important topic that will be covered. Given Ohio’s strengths in manufacturing, the energy-efficiency industry could be a significant economic opportunity for the state. Up until now, there has been very little focus on how Ohio manufacturers will play in the energy efficiency industry and the impact it can have on the economy. Advanced Energy Economy Ohio (AEE Ohio) will share the results of a statewide energy-efficiency road map that will highlight the energy-efficiency products and services being provided by Ohio manufacturers, the specific players and areas of critical mass they represent, and priorities for the state and its regions to target for growth.

Energy policy experts will preview what is on the horizon for innovative state policy approaches, the short- and long-term scenario for federal initiatives and opportunities for the Buckeye State. Attendees will gain an understanding of the policies needed to continue to build Ohio’s advanced energy industry.

Companies that have deployed some of the most significant advanced energy projects in Ohio will share their experiences with getting advanced energy projects launched, as well the challenges, successes and the outlook for initiating similar projects in Ohio.

The conference program will be complemented with a robust exposition hall, showcasing innovative companies, researchers and technologies in Ohio. More than 120 companies and organizations are expected to exhibit. A new addition to this year’s event is the Technology Showcase, which will feature short presentations by companies and researchers who are seeking collaborators, project/demonstration resources and partnerships for funding.

An exclusive online social networking tool, called “B2B Connections,” will be used to facilitate networking among conference participants. This online tool provides attendees, exhibitors, sponsors and speakers the opportunity to connect based on matching interests, enabling them to communicate and schedule one-on-one business meetings with targeted prospective individuals and companies. Attendees are encouraged to register in advance at www.advancedenergyexpo.com.

How Chip Conley uses emotional math to drive leadership practices at Joie de Vivre Hotels

Chip Conley, founder, former CEO and strategic adviser, Joie de Vivre Hotels

Going into 2008, Chip Conley was concerned about the future, and not just for the obvious reasons. Yes, there was the looming possibility of another economic downturn. And with his company launching 15 hotels in a 21-month period, he wondered like many business leaders what impact a recession would have on his organization and its 3,000-plus employees. The difference was Conley’s personal life was also in turmoil.

“We were growing as fast as we ever had at a difficult time,” says Conley, the founder of the San Francisco-based hotel group, Joie de Vivre Hotels. “I also had a family member who was going to San Quentin prison wrongfully. … I had a long-term relationship end. I had five friends commit suicide during that time.”

Soon, the CEO faced the repercussions trying to juggle so many emotions.

“I had my own flat-line experience,” he says.

After finishing up a speech in St. Louis, Conley fell unconscious. In the five to 10 minutes that it took the paramedics to arrive, his heart stopped.

While Conley fully recovered from the heart attack, his experience sent him through a search for meaning, a way to make sense of all the things happening in his life.

“CEOs — you sort of think that they’re above all the emotions and the difficulties and no one should be pitying any CEOs,” Conley says. “You know — ‘Don’t cry for me, Argentina.’ But the bottom line is that I was really confused by all of the emotions I was feeling — a lot of things were falling apart in my life at once.”

As the leader of a $250 million business, Conley knew that he couldn’t be the only one facing this challenge. To empower himself as well as other leaders he did extensive research on the psychology behind emotions and how this translates in business, writing “Emotional Equations: Simple Truths for Creating Happiness+Success.” The book focuses on how business leaders and individuals can become more emotionally fluent, and subsequently, improve their organizations. To date, his transformational leadership practices have been featured in publications from Time to Fortune and The Wall Street Journal.

“In business, what we want to do is influence things,” Conley says. “We want to have an impact. And usually it’s very external: how can I have an impact or influence the world? What I’m saying is if you can influence and impact your emotions, you can actually be more impactful as a leader in the world.”

Become a CEO (Chief Emotions Officer)

Conley’s research on emotions led him to the work of author Daniel Goleman and an interesting finding that the author made in his book “Emotional Intelligence” 16 years ago: that two-thirds of the success of business leaders comes from their EQ — emotional intelligence quotient — while just one-third is due to IQ level or experience. This statistic struck a powerful chord with Conley.

What it means for a CEO is that the best leaders have more influence and control over their emotions. The most effective CEOs are “chief emotions officers.”

“First of all, the more that you’re emotionally fluent and emotionally intelligent about what’s going on inside of you, the more effectively you’ll be as a leader and the happier you’ll be,” Conley says.

The first step in becoming a chief emotions officer isn’t an easy one for all, however. It begins with becoming more attuned to what’s going on inside of you by taking your ego out of the equation.

Conley notices that many young leaders tend to use talking to motivate people. They have a tendency to think that if they give a good speech or make a proclamation that that the emotion will get people excited. While this works sometimes, he’s learned over the years that trying to motivate people without good information can also backfire.

Frequently when people want to get things done, their ambition in tandem with success can lead employees to interpret it as narcissism, Conley says.

“What happens sometimes is a leader of an organization wants to get people fired up and people think that he or she is really out of touch with what they are seeing,” he says. “So it’s a fine line, because you do want to be a visionary as a leader and help people see things that aren’t as obvious, but you also have to keep your feet on the ground.”

Practicing empathetic leadership starts with becoming a better listener.

Conley uses the example of commercial airlines. When jet fuel prices went up and they started adding new charges for items such as amenities, luggage and so on. The exception was Southwest Airlines, which considered the impact on employees when it decided to maintain many of its pre-recession policies.

“The airlines teed off us — the customers — for charging for bags and for food and no longer handing out peanuts, except on Southwest,” Conley says. “So they upset us, but more importantly, they also upset the flight attendants. Because they were going to start charging us for bags, we brought all of our bags on the plane. You turn flight attendants into baggage handlers and the level of the satisfaction of the flight attendants went way down. And guess what? Customer satisfaction plummeted, except at places like Southwest.”

Understanding people’s feelings takes a two-way conversation. So instead of giving a speech about how it’s going to be, Conley now asks his people how they want it to be. As CEO, he frequently had dinners with different groups of employees, taught classes for team members and maintained an open door policy to encourage people to share their emotions and ensure they felt heard.

“When you can understand the subtleties and the nuances of what this person in front of you is looking for in their life, it allows you to deliver on those needs a lot better,” Conley says.

Identify the variables

The challenge in learning to control emotions for most people is becoming more responsive to them. Because people tend to react quickly when something happens to us, they often don’t take time to think about the root cause of emotions or worse, push them off, Conley says.

Due to the stresses of day-to-day business dealings, it might take CEOs days or weeks to realize that something has been eating at them because they were too busy to deal with it at the time.

“Sometimes efficiency takes us away from our emotions and we just ignore them, and then they come out in other ways,” Conley says. “We wonder, ‘Why am I so angry about this?’ and you don’t realize that yesterday this person sort of blew you off when you were supposed to have a meeting with them. And you just had other things to do so you didn’t focus on it.

“So something happens and we react. The lifespan of an emotion physically in your body is usually 90 seconds long, but we actually hold on to it a lot longer than that. It gets stale, but it’s still that emotion that you’re holding onto. Learning how to be more responsive and less reactive is a good thing.”

In a business culture, emotions are contagious, from smiling to yawning and frustration, to fear and anxiety. So not addressing the fear or anxiety of one person — or yourself — can quickly turn into the emotional neglect of many, causing creativity and innovation to suffer.

When Conley researched “Emotional Equations,” he found that although emotions seem fleeting and uncontrollable, they are actually quite predictable. Once you identify the emotion that you or your people are feeling, you need to examine ingredients that created it. Most can be broken down into simple math.

In a study done several years ago, participants were given two choices: get an electric shock now or get an electric shock randomly in the next 24 hours, but it would be half as painful. The vast majority of people in the study chose the option to get the shock immediately.

Why? They had more control over the situation by knowing when the shock would happen, lowering their anxiety.

“Anxiety has two different ingredients: uncertainty and powerlessness, or what you don’t know and what you can’t control,” Conley says. “Once you start to realize this you can actually influence the ingredients and then may influence the emotion.”

Other examples include (Disappointment = Expectations – Reality) and (Workaholism = What Are You Running From?/What Are You Living For?)

By dissecting emotions into variables, leaders can influence the variables to better control the emotions themselves. Take anxiety, for example.

If employees in a company harbor anxiety, they will eventually become distracted and less productive. So when leaders find out that people are anxious about their jobs and finances, they should look for ways to deplete some of the powerlessness and uncertainty they may be feeling.

“If we know that uncertainty and powerless is what creates anxiety, and we know that anxiety makes people less creative, less innovative, less engaged, less productive, then when we have bad news, we better figure out how to package it quickly and get it out to people,” Conley says.

“When people are just stewing about what they think will happen, it becomes a big distraction from what they really should be doing in their work.”

While reassurance with words is always helpful, you also need to take action. Set tangible goals. Provide comprehensive feedback. Get employees more engaged in innovation.

The same goes for anxiety of a CEO. By creating more certainty in your life and taking power over the areas that you can control, you reduce the anxiety that can paralyze you and your organization.

“Even in a time when people are worried about things like layoffs, they can feel like ‘Ah, I have some power or some influence in terms of my effectiveness if I do the following three things,’” Conley says.

Make it a commitment

CEOs who use empathy in their decision-making processes can create cultures with happier employees, who in turn, provide better service.
“What we saw is the more employees felt engaged, the happier they were and the more likely they were to give a great experience to our customers,” Conley says. “So our employee satisfaction went up and then our customer satisfaction went up as well.

“When you get more engaged employees in a service environment, you’re able to put an environment together that allows the customers to get solutions faster. And the employees are going to feel not just engaged but they feel like their fingerprints are all over the business.”

Seeing the power of emotional equations, Conley began teaching them to leaders at Joie de Vivre to help them better identify with their emotions and empathize with the emotions of others. And so far, the impact on organizationwide morale has been overwhelmingly positive.

“Initially people thought, ‘Oh God. Here’s Chip with his New Age stuff again,’” he says. “But honestly, the last few years have been an emotionally trying time for people in the business world. So the fact that I was being vulnerable and authentic about my own fears and frustrations and concerns about life meant that people felt like, ‘OK, I can breathe. I don’t have to be Superman.’”
Giving more voice to emotions doesn’t mean productivity has to suffer either. In fact, it should be the opposite. When people have the safety to express their emotions, they’ll be more empowered to make decisions because the fear of making a mistake or anxiety about their job security won’t be distracting them.

“If you have a problem in a hotel or any kind of business, you want the person right in front of you to solve it,” Conley says. “You don’t want to have them say, ‘OK, well, I’ll talk to my manager.”

While he’s transitioned from the role of CEO, Conley continues to promote the equations at Joie de Vivre as a strategic adviser. Today he focuses on creating one emotion in particular: joy (Joy=Love-Fear), which is also the company’s mission statement.

“Our company name is Joie de Vivre, which means joy of life,” Conley says. “The fact that we have an underlying message and many of us wear these wristbands that say “create joy” is a reminder that that’s what we’re in business to do.”

How to reach: Joie de Vivre Hotels, (800) 738-7477 or www.jdvhotels.com

The Conley File

Chip Conley
Founder, former CEO and strategic adviser
Joie de Vivre Hotels

Born: Long Beach

Education: BA and MBA from Stanford University

What was your first job?

The fries and shake station at McDonald’s

What is one part of your daily routine that you wouldn’t change?

Compensation is a right and recognition is a gift so I try to provide two honest and detailed forms of personal recognition to people I work with daily. If I slack off one day, then I add those to the next day.

What would your friends be surprised to find out about you?

I’m not sure that many people know that I have a 35-year-old stepson, a six-week old baby and three grandchildren, with the oldest being 17 and 3 inches taller than me. As much as Joie de Vivre and our various hotels were sort of like my children and family, I feel fortunate to have these kids and grandkids in my life as they remind me of what’s truly important at the end of the day.

If you could have dinner with one person you’ve never met, who would it be and why?

Herb Kelleher, the former CEO of Southwest Airlines who was in that position for 37 years. He created a compelling culture that walked its talk around the customer coming second and the employee coming first. The airline industry is brutal — cyclical, high fixed costs, lots of unions, big risks — so I’d want to learn more about how he dealt with the emotional roller coaster that came with being CEO for three dozen years. He outdid me by a dozen years since I was CEO of JdV for two dozen years.

Victoria Tifft: Growing pains

Victoria Tifft, founder and CEO, Clinical Research Management

Most companies start with outstanding customer value propositions. But as time passes, and customers change, the once-upon-a-time on-target value propositions become out of date. Soon customers become dissatisfied because vendors don’t seem to understand their current needs. They begin to believe they’ve outgrown their vendors and start to look for new answers to their problems.

This isn’t true of every company. Some companies make staying close to their customers and understanding their changing needs a top priority. These companies use a process to check themselves and ensure that they’re constantly staying on top of changing customer priorities. The process starts by asking several questions:

1. Who is your customer? What do they do? What are their challenges?

2. Have your clients aged? Have their needs changed?

3. What is your customers’ cost structure in this economy?  Do your bells and whistles deliver the value they did in boom times?

4. Is your customer using technology to do some of your core offerings?

5. How well do you truly know your customers? How often do you visit your customers?

If you don’t know the answers to these questions, then it’s time to get back to basics. Here are a few steps to get you going.

Step 1: Get to know your customer again.

Recently, our company found that many of the people with closest ties to our clients were starting to retire. We put together a customer visit “blitz” to visit all our existing customers and prospects within our existing accounts. We made sure they knew who we were and what we did, but most of all, we listened. We inquired about new challenges and took time to learn how we could understand the root of their problems.

The point is, if you want to understand your customer’s changing needs, don’t just visit the people you are familiar with — get out on the front lines with the people doing the core work and buying new products or services. Find out what your customer’s requirements are for timing, cost and quality. Really listen to your customers so that you can understand their goals and the obstacles that prevent them from reaching those goals.

Step 2: Re-center yourself in your customer’s new world.

After listening to your customer, develop a new value proposition. We realized that our customer’s budget constraints were far more severe than we originally thought. Our customer had no choice — they had to do more for less. We had to figure out a way to whittle down what wasn’t essential and find ways to add real value through technology, resourcing, and efficiencies.

Step 3: Change.

Ouch, yes — change. Your staff will be entrenched in the way they do things, or the products you offer, but change will be imperative. Without it, you risk losing your business over time.

Put your staff in a room and present your “new” client’s needs to them. Ask them, “If we had to start over today, how would we support this type of a client?” You may need to develop high-level processes, add resources or create a realistic profit-loss statement. Then, ask your management team to look at how that differs from where you are today. Create strategies that will allow you to execute and deliver your new value proposition.

Present your customer’s “new” need. Create a new value proposition. Go back to answering your customer’s requirements of time, cost, quality, and peace of mind. The result will be a path to change that’s been developed by your people in a non-threatening, problem-solving way. And best of all, it will be in sync with your client’s needs.

Victoria Tifft is founder and CEO of Clinical Research Management, a full-service contract research organization that offers early to late-stage clinical research services to the biotechnology and pharmaceutical industries. She can be reached at [email protected] Clinical Research Management Director of Business Development, Lori Gipp, assisted in the writing of this article.

How Rick Dawson addressed the challenges of growth at Bal Seal Engineering

Rick Dawson

Rick Dawson, president and CEO, Bal Seal Engineering Inc.

At some point in the past few years, it hit Rick Dawson: He had hundreds of experts working in his business, but no one was really working on the business.

The president and CEO of Bal Seal Engineering Inc. had 450 employees around the world. Just about all of them were performing at a high level, helping to vault the industrial solutions company into an era of growth, while most businesses were dealing with the effects of the recession.

“That has been the good news for us,” Dawson says. “A lot of businesses have been struggling, but we have been growing at a rate of just over 15 percent per year.”

Last year, the company generated $75 million in revenue, up from $64 million in 2010. The sailing was smooth, there were no alarm bells ringing at the company’s headquarters. Bal Seal was in a rare place of peace amid tumultuous economic circumstance.

Yet, Dawson sensed trouble forthcoming if he let the company continue to ride on its own momentum. Specifically, he saw a company that could strain itself by growing too fast, and growing without a well-defined strategic plan.

“We have been expanding into new markets and new regions,” Dawson says. “That definitely puts a strain on your capacity and resources. So, working with our leadership team, it has been important to establish clear goals and objectives of what our on-time delivery expectations are, what our product development requirements are, what our sales goals are. Then, make sure everybody clearly understands the direction and measures those results.”

Dawson has worked with the leadership team at Bal Seal to formulate a strategic plan that could help the company better manage growth, but that is only part of the equation. He and his team have also needed to work tirelessly to create alignment on plan throughout the company’s associates, spread among offices in Colorado, The Netherlands, the Czech Republic, Hong Kong and Japan, in addition to the company headquarters in Foothill Ranch.

Start at the top

Like many businesses, Bal Seal organizes yearly strategic planning meetings. In those meetings, Dawson and his management team plot out the umbrella goals and objectives for the coming year. The companywide goals are then used to formulate goals for each division and team within the organization.

“We develop functional goals and objectives for our operations team, sales team, health and safety team, and so forth,” Dawson says. “Those are then put into even more specific goals and objectives.”

The goals and objectives are what Dawson terms “smart goals” — specific, measurable, achievable and realistic. Dawson wants his employees to stretch beyond their comfort zone at times, but not so far that they’re reaching beyond the realistic capabilities of themselves or the company at that point in time. Goals need to be ambitious, but still realistically achievable.

Dawson and his team monitor the progress of the departments in implementing the cascaded goals through a series of stoplight meetings, which got their name from the three-color system assigned to the progress level of each objective.

“It’s a two to 2½ hour meeting each month, and each department manager is responsible for reporting the progress on their goals,” Dawson says. “Green means there are no problems and there is nothing to really talk about. Yellow means you have a problem, but you have worked within your own departmental team to come up with a solution. Red means you have a problem and haven’t been able to come up with a solution. If you have an objective that you have classified as “red,” we can then schedule a separate meeting to assist in dealing with that problem.”

Though Dawson likes to limit the number of meetings throughout the company, he has found value in the monthly stoplight meetings, which have helped to identify and address problems before they become major issues that compromise the pursuit of a department’s goals.

“The operations team was working on an on-time delivery objective, and what they found was that they were struggling to get a specific order out on time,” Dawson says. “It was an aerospace customer, and we had lead time issues with getting materials in on time. Then on top of that, we were having capacity issues.

“But by communicating with the sales team, those of us on the management team were able to identify exactly what they were struggling with, and the history of the customer that were impacted.

“Once we did that, the sales team was able to step in and get some relief from the customer. We were able to explain the delay, which was resulting from raw materials that were delayed offshore. Once the customer understood, it provided relief to the operations team, which helped us get the orders ready on time.

“Because we were able to get together and talk about it, we were able to identify the customer and the problem, and the problem was resolved before the product was late to the customer.”

Create alignment

As the layers and locations within your company increase, creating and maintaining alignment on organizational objectives becomes a more difficult and more involved task to accomplish. With 450 employees, Bal Seal doesn’t face the communication challenges of companies that employ many thousands. But with locations around the world, the management team still had its work cut out.

To help strengthen alignment, Dawson does what a lot of CEOs do: he logs air miles, visiting each of Bal Seal’s facilities twice a year, and having in-depth meetings with the facility directors at each stop.

“It’s important that you’re promoting the message to everyone, from the machinists to the managers,” Dawson says. “I also want to reinforce the messages laid out in our plan at the start of the year. We know at the beginning of the year what the schedule is for Europe, for Asia, but it is a constant challenge to make sure the staff remains aware of it, and is kept up to date on what is going on.”

There is a limit to how far down in an organization a CEO can, and should, reach. If the company is large enough, your place is not managing the factory floor. But you still have to construct a system that allows you to connect with everyone in the organization, from the top to the bottom.

If you can keep your finger on the pulse of the mood and attitude of your lowest-rung employees, you are in a much better position to determine whether your messages are permeating every layer of the company. You are also in a much better position to cut off the rumor mill, should issues arise.

“For example, we’re currently building a second facility in Colorado Springs,” Dawson says. “When I said we were building a new facility there, what everyone in the company heard was,‘We’re moving the company to Colorado Springs.’ That wasn’t the case. We’re expanding there. That’s where having a means of staying connected to everyone in the organization is so important. I had to reaffirm that we’re continuing our growth and expansion, not relocating.”

Dawson didn’t have to reinvent the wheel every time he presented the message to a new audience, but he did have to tweak it in a manner that addressed the questions and concerns of whichever group within Bal Seal was receiving the message.

“It’s important that you’re promoting the message to everyone, from the machinists to the managers,” Dawson says. “To the machinists, you’re promoting the idea that the expansion allows for more job security. You’re soliciting input from the managers, and on the executive level you’re promoting the vision for the overall corporate goals, and the deliverables in order to achieve those goals.

“The communication and interaction is something constant, something that you can’t push into the background.”

Another aspect of alignment centers on the widely-held business truism, “What gets measured, gets managed.” If you want to create alignment around organizational goals, you need to create universally-understood methods of measuring them. Usually, that means measuring the statistical categories most important to the success of your business.

“I measure cash, I measure sales, I measure on-time delivery, and I measure safety, which is my number one category,” Dawson says. “So you’re monitoring those on a regular basis, and talking with your managers about it.

“You are going to view your management team as something of a mouthpiece, since you can’t be everywhere at once. So you have to help them stay aligned on the plan, and monitor what they’re saying to their teams. You just continue to provide guidance.

“If you manage the relationships with your managers, you can better manage the flow of communication throughout the company. You oversee those relationships with your managers by ensuring that you are comfortable, and they are comfortable with the vision and direction, and thoroughly understand it.”

Build your team

Consistency is one of the biggest keys to maintaining a message for a large audiences over an extended period of time. That means consistency in how you communicate, when and where you communicate, but it also means maintaining consistency in the structure of your management team.

Turnover will occur. If a member of your team is talented and driven enough, and has reached a ceiling in your organization, that person will likely leave when a better opportunity comes along. So it’s prudent to develop new leaders from within.

When the time comes to fill a space on his management team, Dawson prefers to promote internally, looking outside the organization only when he believes there is a need. Internal candidates have proven that they can help promote and execute the strategic plan. But even when promoting from within, it’s not an exact science when looking for those who have the right competencies and right attitude.

“You break your people into quadrants,” Dawson says. “There is willing and able, willing and unable, unwilling and able, and unwilling and unable. Obviously, you’re looking for willing and able. If you have someone who is willing and unable, you have a performance issue. If you have someone who is unwilling and able, you have to see if you can educate them in the process. If you have unwilling and unable, you’re probably not keeping them.”

To hit for the highest possible willing-and-able average, Dawson wants to see prior evidence of accomplishment, creativity and integrity in the work experience of job candidates.

“A lot of people will come into an interview and say ‘I’ve been the manager of sales,’ but when you ask them how they ran their sales organization, when you ask them about their vision and direction, they can’t get down to specifics. If that’s the case, they’re probably not the right fit for the organization.

“After you hire someone, you’re continuing to assess them. You’re working with the person to set goals and objectives, and if they’re complying and conforming, you’re doing great.

“If you are seeing a continuous pattern of not meeting goals and objectives, then you have to be willing to be very honest and candid with the person, explain to them what the issues are, and from there, you can assess the next level of whether they’ll be a fit for your organization moving forward.

“But it is important to continue to work with the person to help them succeed. Building a team is a continuous process of communication and direction.”

How to reach: Bal Seal Engineering Inc., (949) 460-2100 or www.balseal.com

The Dawson file

Rick Dawson

President and CEO

Bal Seal Engineering Inc.

Education: Mechanical engineering degree, California State University, Long Beach; MBA, Pepperdine University

What is the best business lesson you’ve learned?

The No. 1 rule I’ve learned is that you can never run out of cash. You need to have liquidity in the business. You also need to have an ability to make strategic and tactical changes. If you have a strategic plan, implement it and then measure it.

What traits or skills are essential for a business leader?

I think the No. 1 thing is communication. On top of that, you need perseverance, because things don’t always work out the first time. It is also important that as a leader you are willing to take the time to understand your people and communicate with them.
What is your definition of success?

To meet the plan you set out to accomplish. If you want to grow the business at a certain percentage, success is meeting that number.

How women and men can better blend their efforts in the workplace

Sherri Elliott-Yeary, CEO, Optimance Workforce Strategies

Everybody knows that men and women think differently. But do those differences matter when it comes to working remotely and managing remote teams? In my opinion, they matter a lot. Managers who don’t understand and embrace these differences do themselves, their companies and their employees a disservice.

In my new book, “You Can Have It All, Just Not All At Once,” I cite scientific studies that show how women’s and men’s brains function differently from one another. These differences are important because managers who are unaware of these conflicting world views might assign values to behaviors that don’t get the desired results.

Break it down

A major difference in how the sexes’ brains function is that women tend to be skilled multitaskers, while men are able to concentrate on one task for longer periods. Neuroscientific research confirms this, and women often take pride in their ability to handle several things at once.

This is a plus and a minus, both for women and for those who manage them. I believe it’s a core reason that women tend to overcommit. Those who manage women remotely can benefit from understanding this, especially since excessive multitasking can inhibit creative thought and lead to burnout.

On the flip side, a man’s ability to focus on one thing for a long time can be seen as beneficial, but it can also lead to tunnel vision and insensitivity to people and any behavior not seen as mission-critical. There’s also a tendency to believe that the amount of time spent on something equals better results, which is not always true. Often, short bursts of concentration bear better fruit than agonizing over tasks for extended periods.

A major difference between the sexes that impacts managers is that women are generally more likely to speak up if they’re unhappy about their circumstances, while men tend to suffer in silence. Normally, men will tolerate a negative situation longer than women will. This doesn’t mean that a woman’s complaints are without merit, or that men don’t experience the same misery.

But if a woman mentions that something is wrong, she might be seen as a complainer by a male manager. Conversely, a female manager might take a man’s stoicism as being uncommunicative or not proactively trying to improve a situation. Such value judgments can harm a working relationship.

Without the daily contact and familiarity of working in the same location, it can be difficult for managers to understand what’s going on with their team. One person’s laserlike focus is another’s antisocial moping. A willingness to abide short-term discomfort for long-term goals needs to be balanced with a willingness to change and improve the current situation.

Seek solutions

Understanding how gender impacts behavior is a key reason why good leaders take the time to get to know their people and look at results, not at specific behavior that can be misinterpreted.

Gender Difference No. 1: Typically, men communicate in bullet-point style and strive to get to the point quickly, while women are more prone to tell a story or paint a picture. Women share experiences to show commonality and build on other people’s discussion points, whereas men focus on statistics and rankings and relate by sharing stories to “one-up” each other.

Solution Strategy: Women need to get to the bottom line quickly and succinctly. Men need to understand that when a woman tells a story, she is building common ground.

Gender Difference No. 2: Women like to talk about a problem, to emphasize their feelings, and to process thoughts aloud as a way to include others. Men like to move to problem-solving right away, alone. They place high value on achieving results and prefer activity over discussion.

Solution Strategy: Women should not try to get men to talk if they’re not ready; they should observe and listen rather than processing out loud. Men need to understand that processing is a way for women to include others and build relationships.

It is my belief that men and women can become one through understanding, value and honor. We all need each other, and even when we don’t agree on everything, we can learn to disagree while still showing respect for each other’s differences.

Sherri Elliott-Yeary is the CEO of human resources consulting companies Optimance Workforce Strategies and Gen InsYght, as well as the author of “Ties to Tattoos: Turning Generational Differences into a Competitive Advantage.” She has more than 15 years of experience as a trusted adviser and human resources consultant to companies ranging from small startups to large international corporations. Contact her at [email protected]