Category Archives: leadership

Exploiting a crisis

Be careful how you do it.

I wrote this article a few years ago and it has been a useful reference many times – even before the pandemic crisis, a Russian invasion of Ukraine, rapidly rising inflation and punishing interest rates. It advises of appropriate management tactics to survive and thrive through challenging times, but use them with caution. Don’t overdo it!

Managing in Difficult Times

https://learningentrepreneurship.com/managing-in-difficult-times-2/ 

Ignoring or avoiding a difficult business environment is simply not possible. So what are some helpful ideas to respond effectively?

  • Stay focused Avoid being distracted by the bombardment of bad news. Misery may love company, but everybody remains miserable if you just talk about it and do nothing. Be creative and don’t neglect the good news; look for the silver lining in the dark clouds.
  • Be relevant Costumers will be postponing or redirecting their purchase decisions. Can you keep their business with new services, packaging, pricing, terms and conditions?
  • Leverage the sense of urgency Employees and customers are sensitive to the same issues and challenges and will be amenable to new solutions. More likely to accept cost cutting, postponing projects, revising compensation and benefit plans, changing business models, re-aligning marketing programs, raising prices and reducing services. Take advantage of the sense of urgency that exists; just be cautious not to do permanent damage to employee, customer, and supplier relationships.
  • Recognize the changing environment Revise your corporate budgets and business plans. Update external benchmarks to remain competitive.
  • Look for new opportunities Build on the losses of shaky competitors; or buy them out.
  • Talk to your bank Make sure they are not worrying unnecessarily; or at least worrying for the right reasons and hearing directly from you.
  • Avoid being the unwilling prey Manage appearances; be prepared to take the initiative. Know your value and your preferred business partners.

In summary: Be brave, be flexible, be creative.

We are currently living through extremely challenging times with multiple crises all happening at the same time. The extended duration of stress and disruption to our lives and businesses can lead to over-reaction to new disturbances and bad decisions that may cause irreparable damage – employees quit; clients and customers go elsewhere.

Be cautious about exploiting the crisis. Employees and customers may be receptive to accepting changes because they understand they current conditions affecting everyone. Supply chains have been disrupted, skilled labour is lacking, but arbitrary and unjustified price increases and cancellation of services are not acceptable.

Be reasonable; be rational. And manage the message.

Del Chatterson, your Uncle Ralph

Learn more about Enlightened Entrepreneurship at: LearningEntrepreneurship.com Read more of Uncle Ralph's advice for Entrepreneurs in Don't Do It the Hard Way & The Complete Do-It-Yourself Guide to Business Plans - 2020 Editions.

 Read more Blog posts at: LearningEntrepreneurship Blogs

 

 

Managing in Difficult Times

Ignoring or avoiding a difficult business environment is simply not possible.  It will happen, sooner or later.

A credit crisis, stock market meltdown, or a looming recession all affect the attitudes and actions of consumers, employees, investors, lenders and business managers. What are some helpful ideas to respond effectively?

Stay focused

Avoid being distracted by the bombardment of bad news.

Stay focused on customers and employees, especially the ones that you have and want to keep. Don’t freeze. But don’t over-react.  Be calm, rational, reassuring and pro-active.

Don’t just share the pain, provide relief.  Misery may love company, but everybody still remains miserable if you just talk about it and do nothing. Try to be more creative and take appropriate action. Don’t neglect the good news; look for the silver lining in the dark clouds – maybe currency exchange and interest rates are down temporarily, so now you can expedite foreign currency sales or re-finance some lending to improve cash flow.

Be relevant

Take a close look at your customers’ changing needs and your product or service offerings.  Do you have recession proof products or are they vulnerable? Costumers will be postponing or redirecting their purchase decisions in the current challenging climate.  Can you keep their business with a new cost-reduced service or a more creative approach to packaging, pricing, terms and conditions?

Leverage the sense of urgency

Nobody is unaware of the current economic circumstances affecting your business. Employees are already aware of the issues and the problems in front of them, so it will be easier to get them to accept the solutions. That means it’s more likely that they are receptive to expense reductions, removing frills, postponing projects, reducing assets and conserving cash. It may be opportune to revise compensation or bonus plans, change distribution channels, move marketing programs to lower cost online approaches.

Take advantage of the sense of urgency that exists. Now is the time to resolve lingering problems; just be cautious not to do permanent damage to key employee, customer and supplier relationships that you want to retain.

Recognize the changing environment

You probably started the year under different assumptions that affected corporate budgets and business plans.  Sales targets may now be unrealistic and should be adjusted downwards to maintain the rewards and motivation for top performers who continue to deliver in spite of challenging times. Try to use an external benchmark to justify the adjustment and not give the impression that you are forgiving poor performance.

Look for opportunities generated by the crisis

If you have been smart enough to stash cash and build a relatively secure business, then you can take advantage of some unique opportunities that exist.  Build your team by attracting top performing employees who may be ready to move from shaky competitors into your welcoming arms. Or buy out a competitor, if the company is suddenly for sale at a bargain price.  The big boys are doing it; so can you.

Talk to your banker

Make sure she is not worrying unnecessarily. Or at least worrying for the right reasons and hearing them directly from you.

If you are in better shape than most and credit is available, then increase your credit limits now to handle the potential unexpected impacts and to support the new opportunities you may want to pursue.

Avoid being the unwilling prey

Recognize that competitors may also see you in difficulty and seize the opportunity to raid key employees or buy you out at a distressed price.  You need to keep close to your key employees and ensure their career plans remain with you. If you are a likely target for merger or acquisition, then start working on your choice of preferred partner and determine your business valuation under normal circumstances, not current crisis conditions. Then take the initiative before you lose control of the situation. You and your business will be better for it.

In summary:

Be brave, be flexible, be creative.

Analyze, decide, take action.

 

Don’t be too perfect

Or too precious. You’re not that special.

In occasional attempts at false modesty or humble bragging we might admit to being too much of a perfectionist. In fact we have probably already learned that perfectionism is not only the enemy of good, but it also pisses people off.

Nobody wants to be driven to pursue the impossible expectations of a perfectionist. Good enough never is, as my father used to say, but excellence is usually entirely acceptable.

Somewhere between the arrogant and demanding perfectionists like Steve Jobs, who never accept that customers know what they want, and the impatient managers who apologize for imperfections and push out “minimum viable product” to test customer response, is the responsible, competent manager who insists on quality and performance that will cause customers to rave about it and ask for more.

Don’t be too perfect. But do try to find the right balance. Be better to do better.

(P.S. I hope you didn’t find any typos or misspellings in this newsletter on perfectionism.)

Be better. Do better. 

Del Chatterson, your Uncle Ralph

Learn more about Enlightened Entrepreneurship at: LearningEntrepreneurship.com Read more of Uncle Ralph's advice for Entrepreneurs in Don't Do It the Hard Way & The Complete Do-It-Yourself Guide to Business Plans - 2020 Editions.

 Read more Blog posts at: LearningEntrepreneurship Blogs

 

 

Results are all that matter?

Wrong. Character matters.

This commentary was originally posted in 2019 when the whole world was watching and worrying about the true character of well-known figures like Bill Cosby, Harvey Weinstein, and President Trump. It also appears in Don’t Do It the Hard Way – 2020 Edition.

Sometimes we learn more than we ever wanted to know about our leaders, role models, and heroes in society. Then we have an awkward question to consider: Should we dismiss everything they ever accomplished because of their character flaws and their immoral, unethical or even criminal behaviour?

Many people have chosen to ignore the character and behaviour their heroes and their leaders because they valued, respected and admired their ideas and the results they achieved. Many of them have since learned to regret those choices and recognize that character matters.

Morality and ethics matter

The accomplishments are forever tainted and diminished by the suspicions that they were not achieved legitimately. We’ve learned about the lying, cheating and abuses that are part of their history and assume those tactics were used to get the results they wanted.

Why is it important to assess character, morality, and ethics in choosing our leaders and role models? Because we want to be reassured that the results will be achieved according to acceptable moral and ethical principles that go beyond personal ego and self interest.

If you’re a corporate CEO, a politician, an entertainer, or an entrepreneur and business manager, your performance is continuously being assessed based on the results you achieve. Does it matter how they are achieved? Some people think not. Results are all that matter. Especially if the results are what they want and they can ignore the consequences and side-effects on other people.

They’re wrong.  Character matters. Ethics, morality, attitude and behaviour matter. Tactics and methods matter. Words matter.

Sometimes the desired results may appear to be achieved, regardless of the behaviour. Immoral, ruthless, and aggressive behaviour may even appear to have been necessary to achieve the results. Wrong again.

The apparent short-term gains will eventually be lost to long-term reactions. Those who are used and abused will get even. A legacy of accomplishment may be completely dismissed and forgotten when true character is revealed.

Be better. Do better.

Your Uncle Ralph, Del Chatterson

 

Are you an Activist CEO?

Leading with your values?

It’s no longer an option. It's now expected, by your employees and your customers. They have choices to make – who to work with and who to buy from. That’s the new reality in today’s hyper-sensitive, highly politicized, and widely publicized world.

Or are you a politician, avoiding the issues and trying to please everybody, not wanting to offend anyone? 

That used to be the best strategy to attract and retain employees and customers, but it’s no longer good enough. We already knew that the ruthless, selfish, greedy and irresponsible CEO was nobody’s first choice, but don’t be evil is no longer good enough either. (Unless your objective is to appeal to evil people who are selfish, greedy and irresponsible.)

There is more joy and more opportunity to do well by being good - an ethical, enlightened, and socially responsible CEO and entrepreneur. Leading by example is a good start.

Stepping up and speaking out comes next. The people you need to succeed are watching and they expect you to do more. More than a Tweet, more than a press release, more than a new tagline or marketing slogan. Action proves how you really feel and who you really are. Do more and you’ll attract the people you really want to do business with, and you will have a real impact on the people and the planet around you.

Whether you have 40,000 employees around the world or only four people working in your local shop, you can make a difference.

Be better. Do better. 

Del Chatterson, your Uncle Ralph

Learn more about Enlightened Entrepreneurship at: LearningEntrepreneurship.com Read more of Uncle Ralph's advice for Entrepreneurs in Don't Do It the Hard Way & The Complete Do-It-Yourself Guide to Business Plans - 2020 Editions.

 Read more Blog posts at: LearningEntrepreneurship Blogs

 

Celebrity CEOs 

What do they know?

I remember my investment broker telling me years ago, “making money doesn’t make you  smart.”  Maybe you’re just lucky. Or maybe all that talent and education and hard work finally paid off. And maybe these celebrity CEOs can tell us how to do better for ourselves and our businesses. They seem to be rich and smart and successful.

But don’t judge a book by it’s cover, or the recommendations of other celebrities, or the fact it’s a bestseller. Those are just signs of good marketing. (Lessons there that might help me sell more of my books!) But buyer beware. It’s important to check the credentials and the content before we get too excited looking for nuggets of truth and wisdom in their books.

I’m currently reading Ray Dalio’s, The Changing World Order, and Marc Benioff’s, Trailblazer. Dalio is the billionaire founder of Bridgewater, the largest hedge fund in the world, and Benioff is the billionaire founder of Salesforce, a world leader in cloud computing and customer relationship software. Both very bright, rich, and successful.

Dalio presents an interesting perspective on the rise and fall of empires over the last 500 years and the effects on banking, currency, finance and economics. He recommends his principles for investing to deal with current and future changes in the world order. There are some helpful insights for managing your investment portfolio, but I find the fifty to one-hundred-year timeline not very relevant for decision-making in today’s volatile world affected more by short-term political and economic issues. As another famous economist, John Kenneth Galbraith, reminded us, “In the long run, we’re all dead.”

Benioff’s book is more relevant for CEOs and small-business entrepreneurs trying to navigate current social and cultural issues of the modern world affecting their businesses every day. Benioff is the epitome of the ethical, enlightened entrepreneur and explains his belief that business is the greatest platform for social change.

Salesforce was founded in 1997 and guided from the start by Benioff’s principles:

  • Values create value
  • Creative success is a triumph of imagination guided by values
  • Consistent application of Salesforce’s core values: trust, customer success, innovation and equality are essential to it’s continuing success
  • Corporate culture defines how you express your values
  • Employees at all levels must be committed to the culture of supporting local communities and advancing social progress.

Benioff admits to the challenges and the mistakes he’s made in the process, but he sets a very high standard for any business leader to follow and be more pro-active. He makes a very convincing case that being socially responsible and active in the community will make the business more attractive to employees, customers and other stakeholders, and consequently, more successful. But it has to be more than a mission statement, more than a marketing slogan.

Are you a believer? Are your actions guided by ethical values and a social conscience? Is your business a platform for social change?

Be better. Do better. 

Del Chatterson, your Uncle Ralph

Learn more about Enlightened Entrepreneurship at: LearningEntrepreneurship.com Read more of Uncle Ralph's advice for Entrepreneurs in Don't Do It the Hard Way & The Complete Do-It-Yourself Guide to Business Plans - 2020 Editions.

 Read more Blog posts at: LearningEntrepreneurship Blogs

 

 

 

 

Resilience - Fighting fatigue and frustration.

What is resilience?

It’s not just bouncing back after a major setback or getting through difficult times. It’s not only about celebrities and superstars recovering from serious injuries or illness and returning to top performance again; it’s also about business owners getting back to work, serving customers and providing a boost to employees and the local economy.

In product design and engineering, resilience is the built-in ability to absorb or avoid damage without suffering complete failure. You have that ability too.  Remind yourself of the severe challenges that you’ve survived in the past.

You can handle this. Don’t let the (whatever) grind you down!

Resilience is stubborn resistance to fatigue and frustration. Avoiding poor performance and bad decisions – like giving up, or defiant opposition to doing what needs to be done. Resilience means it's time to suck it up, call on your reserves and find more creative ways to respond to difficult circumstances. Inspire yourself and others to do what’s necessary.

Be resilient. Be strong and persistent, retain your guiding principles and follow your moral compass. You’ll get back on the path to where you want to be.

Be better. Do better. 

Del Chatterson, your Uncle Ralph

Learn more about Enlightened Entrepreneurship at: LearningEntrepreneurship.com Read more of Uncle Ralph's advice for Entrepreneurs in Don't Do It the Hard Way & The Complete Do-It-Yourself Guide to Business Plans - 2020 Editions.

 Read more Blog posts at: LearningEntrepreneurship Blogs

 

 

Pay yourself first

Profit is not a dirty word.

It may seem inappropriate, but it’s not. My advice to entrepreneurs is always to align your business objectives with your personal objectives. It’s the best way to ensure your ongoing commitment, patience and persistence through all the roadblocks, detours and setbacks. Like making a career choice; find out what you’re good at and what you also like to do – do that.

If you’re running a business, you want it to succeed. I know you’re not in it just for the money, but it needs to be profitable to be successful. Your employees, customers, suppliers, business partners and investors, the governments and communities you support, are all counting on you. Don’t screw up!

You can ignore the pontificating anti-capitalist critics who think profit is a dirty word. If your business is profitable, they’ll assume you’re among the evil, greedy, selfish capitalists ripping off customers and employees and killing the planet. Don’t bother to argue, explain or apologize; they’ve already stopped listening. Stay calm, carry on.

Your business success is measured by it’s profitability over time. You will be judged on how you made it and how you use it, not on how much you made. Did you lie, cheat or steal to earn it? Are you investing your profits back in the business? Are you paying employees fairly? Are you meeting your obligations to society, people and the planet?

You can pay yourself first; it’s important that you continue to be motivated and adequately rewarded for your leadership and good management in running a profitable business. It’s also important to have some of your cash flow going into other investments – to build your retirement funds, to diversify your portfolio and to avoid the risk of losing everything in a business failure. Just keep your own compensation within reasonably acceptable limits for internal and external equity.

Remember you are also counting on the support of the people who are watching you.

Be better. Do better. 

Del Chatterson, your Uncle Ralph

Learn more about Enlightened Entrepreneurship at: LearningEntrepreneurship.com

Read more of Uncle Ralph's advice for Entrepreneurs in Don't Do It the Hard Way & The Complete Do-It-Yourself Guide to Business Plans - 2020 Editions.

 Read more Blog posts at: LearningEntrepreneurship Blogs

Learn to live with it

Doesn’t mean ignore it.

 We keep being told we have to learn to live with it.

It seems to me a useless cliché, whether it’s applied to the continuing risk of Covid variants, to the Russian invasion of Ukraine, to the humanitarian crisis in Europe or to the threat of escalating military conflict into WWIII.

It’s a lot to worry about and it’s more distressing and disturbing to feel we are unable to affect the outcomes. However, ignoring the dangerously volatile world around us and hiding inside our personal safe havens are not good choices.

We can do more.

We can be responsible, intelligent citizens and contribute to better outcomes. Be safe, take care of yourself and others. Speak up. Lend your support to the causes of public health, freedom, democracy and human rights.

You can make a difference.

Be better. Do better. 

Del Chatterson, your Uncle Ralph

Learn more about Enlightened Entrepreneurship at: LearningEntrepreneurship.com

Read more of Uncle Ralph's advice for Entrepreneurs in Don't Do It the Hard Way & The Complete Do-It-Yourself Guide to Business Plans - 2020 Editions.

 Read more Blog posts at: LearningEntrepreneurship Blogs

 

 

Management science?

Or an art.

I was in engineering at UBC when I discovered that management was much more appealing to me than engineering. I didn’t ever enjoy the study of vector analysis or rock mechanics and I have zero mechanical aptitude, but I was hooked immediately after taking two optional courses – Economics 101 and Psychology 100.

That’s what management is all about! Both the science and the art.

After two years working as an engineer, I went back to school for my MBA at McGill. They attracted me by their scientific approach to management with courses on operations management, computer science, finance and economics, with a heavy dose of behavioural science. All the knowledge, tools and tactics I would need to become a successful manager, maybe even a future CEO of Alcan Aluminum, where I worked immediately after graduation. However, I received an even better education in the subject of management and corporate leadership from then President of Alcan and the most effective CEO I’ve ever known, David Culver.

But the debate continues – is it science or an art?

Henry Mintzberg argues that management is a craft and expecting to teach it to MBA students without experience is like trying to teach psychology to someone who has never met a real person.

My argument is that it’s a balancing act and fits the definition of any kind of expertise – a combination of sufficient knowledge and experience with a dedication to continuous learning and self-improvement.

Are you an expert manager?

Be better. Do better. 

Del Chatterson, your Uncle Ralph

Learn more about Enlightened Entrepreneurship at: LearningEntrepreneurship.com Read more of Uncle Ralph's advice for Entrepreneurs in Don't Do It the Hard Way & The Complete Do-It-Yourself Guide to Business Plans - 2020 Editions.

 Read more Blog posts at: LearningEntrepreneurship Blogs