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5 Essentials Your Business Plan Probably Lacks

Inc Small Business - Mon, 04/21/2014 - 6:00am

A brilliant strategy and flawless tactical execution aren't enough. You've got to plan for the human side of things.

So you've got a killer strategy that's ready for customers, competitors, and possible disruptive technology. And you've created and are executing to a plan that harnesses big data for logistics, supply chain, and distribution.

Success is inevitable, right? Wrong. You'll be a flash in the proverbial pan if you neglect five essential, nonanalytic, humanistic factors, according to Rich Karlgaard in his new book The Soft Edge: Where Great Companies Find Lasting Success.

On the basis of his study of dozens of highly successful companies, Karlgaard draws the parallel between personal health and corporate health by showing both as equilateral triangles. Here's the one for personal health:

"That triangle is intuitive. To be truly healthy, you must not only take care of your body and mind but also have a social connection. The lack of that connection is deadly; prisoners in solitary confinement, for instance, often go crazy and try to kill themselves."

According to Karlgaard, companies have a "health pyramid", too:

"Your strategy (market, customer, etc.) is the foundation while the hard edge (supply chain, distribution, etc.) supplies the tactics by which you execute that strategy."

However--and this is essential--without the third side of the triangle, the human side, even the best strategies and tactics fall flat. Here's what you need for long-lasting success:

1. Trust

Trust comes in two varieties: external (whether your customers, partners, and investors trust you) and internal (whether your employees trust you and one another).

Without trust, every activity has to pay a "mistrust tax." Suddenly, lawyers are everywhere, gumming things up. Employees spend more time covering their butts than doing their jobs.

The source of trust, internal and external, doesn't lie in your corporate ethics statement or your brand promise. It lies in consistency. People trust bosses and co-workers who are who they say they are, even if they're jerks.

For example, Steve Jobs was a jerk, but he never pretended to be anything else. Similarly, Jim Goodnight, CEO of SAS, is a famously nice guy creating an environment that regularly wins "best place to work" awards.

Despite diametrically opposite management styles, both CEOs built incredibly loyal, effective teams, because their employees knew exactly who they were dealing with. Neither company tolerates hypocrisy.

2. Smarts

You already know that smart people are essential to a company's success. However, there's another element of smartness, which is creating an environment where smart people needn't do dumb things in order to survive and thrive.

For example, in the early 1990s, I worked at DEC with some of the smartest people I've ever met. Despite that, though, they acted like idiots, expending vast sums of intelligence in playing pointless internal politics.

Take a look at the most successful companies and you'll find that they give their smart people the opportunity to be smart. Managers in these firms listen--really listen--to what their smart employees have to say.

Whether in high tech, or in something as low tech as selling insurance, when you've got a culture that values people and their native smarts, you end up with better products, more customers, faster growth, and greater staying power.

3. Teams

The concept of teamwork has been practically done to death, but it still remains a corporate attribute that's usually "honored in the breach rather than the observance."

In companies that are all about strategy and the hard edge, teams are where smart people with good ideas get smacked down into mediocrity.

To my mind, the best example here is Microsoft with its incredibly short-sighted "stack ranking" system that encouraged smart people to sacrifice everyone else on the team in order to look good themselves. (Perhaps that explains the weaknesses in a product like Windows 8?)

By contrast, Google by all accounts is really good at setting up teams and letting them run plays without too much management interference. Though the team culture at Google produced a lot of frustrating dead ends, it also created Android--a product that might eventually kill both Microsoft and Apple.

4. Taste

Taste is the most primal of the senses and speaks to the deepest part of who and what we are as human beings. In the context of business, taste isn't what happens on your tongue (unless you're in the food business) but what happens in the gut.

How do people feel inside when they use your product or service? Do they feel like a hero or a fool? Are their spirits exalted or left cold? Do they spread the word or do they shrug it off? Do they love or dread dealing with your company?

These are not analytic questions but deal with the imponderables of human nature. You won't find the answers in big data but instead in the daily practice of empathy, gratitude, and hope.

5. Story

The final humanistic element is story--not the prepackaged "how we helped our customer" stories that emerge with sad regularity from second-rate marketing groups.

The stories that matter are the human stories, in which real people did something, learning and growing in the process. It might be customers, it might be your CEO, it might be a field sales rep who has learned to believe in the value of what she's selling.

Story is also the story that you tell yourself about yourself, and that every employee tells himself or herself. Story is what gives meaning to everything, both inside and outside the business world.

If those stories are lacking or, worse, depressing, there is simply no amount of strategy and tactics that can make your company great. Same thing with the other four elements. Ultimately, the only way to be more successful is to be more human.

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Categories: Small Business News

6 Things You Need to Know Today

Inc Small Business - Mon, 04/21/2014 - 5:43am

A roundup of the day's news--curated by the Inc. editorial team--to help you and your business succeed.

1. Friend Request: Denied

Newly released documents show that Facebook declined to join a secret society of Silicon Valley elite--including Apple, Google, Intel, and Adobe Systems among others--accused of colluding to suppress wages by actively not poaching each other's employees in the 2000s. Thank goodness for nonconformist new entrants.--Wall Street Journal

2. Innovation, Recycled

SpaceX stirred the scientific (and YouTube) community into a frenzy late Friday when it posted a drone-shot video of a Falcon 9 Reusable rocket taking off from a test site, hovering at 250 meters, then returning to its launch site. Reusing rockets--rather than building afresh for each mission--could give SpaceX a significant competitive advantage.--YouTube

3. Boston Strong

On the anniversary of the Boston Marathon bombing, it's moving to hear one entrepreneur's experience of the event. In a Medium post that's going viral, Foursquare founder Dennis Crowley recaps the moments when he ran the marathon, lost his wife, searched for his parents, and fielded frantic phone calls from reporters and friends. It's a compelling read, and an honest glimpse at the things that move--and go beyond--business, namely those whom you care about.--Medium

4. Do Good, Do Well

Want to help the world's poor? If you're running a startup, you're in better position than large companies. Mal Warwick and Paul Polak, co-authors of The Business Solution to Poverty, write that entrepreneurs are better poised to bring technology products and services to the billions of people in the world living in poverty than big corporations. "The reason is that multinationals face the constant temptation to apply their substantial resources to extend the reach of their existing businesses, rather than starting from scratch. Entrepreneurs, by contrast, start from scratch almost by definition," the duo write.--Harvard Business Review

5. Airbnb in Court

Airbnb will appear in a New York court this week to contest a massive subpoena of host records tied to a suit contending that bad actors are using the service to operate as large-scale rental operations.--TechCrunch

6. New Level Unlocked

If you want to boost your performance at work, try taking up some new hobbies during your off hours. A new study from San Francisco State University finds that creative activities--anything from writing short stories even to playing video games--have a "direct effect on factors such as creative problem solving and helping others while on the job."--Lifehacker

Categories: Small Business News

3 Steps to Turbocharge Your Startup

Inc Small Business - Mon, 04/21/2014 - 5:00am

Accelerate your startup's growth by following these simple rules.

So your startup is growing at 20 percent a year? Great. Can you double that?

The executive board of Black Duck Software recently asked that question. In response, the company, an open source software project management dashboard maker, hired Lou Shipley as CEO. The six-time entrepreneur, who had previously been CEO of VMTurbo--which grew at 100 percent a year--was tasked with doubling Black Duck's annual growth rate from 20 percent to 40 percent.

The company, whose 1,300 customers include Netflix, is soon to launch a new product. Open Source Software Logistics is a method to help track, manage, and profit from a company's OSS development projects. Shipley believes it will help propel Black Duck into the $100 million revenue sphere needed to ramp up its growth and achieve IPO stardom.

These three steps are the core of the company's strategy.

1. Target a big, growing market.

Your odds of getting more than 10 percent of a market are really low. So if you want to grow, go after a bigger market. If your startup has $10 million in sales and 5 percent of a $200 million market, it could be a $50 million company if it could grab the same share of a $1 billion one.

When Shipley took over Black Duck late last year, he saw that its existing market was $12 billion a year. But he sees potential for the market to grow due to the increasing popularity of cloud and mobile computing, big data, and the Semantic Web. The number of open-source projects is also growing rapidly, from less than 100,000 in 2007 to more than a million in 2013. The market is expanding quickly, positioning Black Duck for growth.

2. Keep improving your product.

Gaining market share is simple in concept--understand why customers benefit from your product and make sure your product delivers more of those benefits than competitors' products.

How do you turn that into action? It helps if you know the market and have a better idea about how to satisfy its unmet needs. Black Duck has an advantage here: It essentially created the market for managing a company's use of OSS. It started building a database of OSS projects a dozen years ago and it is now the best thing out there, and Shipley isn't complacent--with this market knowledge, he intends to continue adapting Black Duck's offerings.

3. Trust your CEO to hire the right talent.

Attracting and motivating the best people starts with hiring a great CEO. Such a leader has charisma, a winning track record, deep industry insight, a great industry network, and a magnetic ability to draw talent to a compelling vision.

Shipley believes that Black Duck had great talent when he joined, in disciplines including engineering, sales, marketing, and finance. As he shifts Black Duck's strategy to focus more on financial-services companies and to expand its global footprint, Shipley's ability to bring in new talent will fuel its future.

Do you need to accelerate your startup's growth? Target a bigger market, build an industry-leading product, and hire a great CEO.

Categories: Small Business News

8 Things Truly Outstanding Leaders Do Without Thinking

Inc Small Business - Mon, 04/21/2014 - 3:00am

Here's what outstanding leaders do almost instinctively. Do you share those instincts?

Once in a while you meet a leader who stands out--even in a room filled with skilled, experienced, successful people. She isn't just remarkably charismatic. He isn't just remarkably likeable.

You can tell, in an instant, they simply think and act and lead differently than most people.

But those rare individuals don't become outstanding leaders overnight. While some are born with an aptitude for leadership, truly outstanding leaders are made. Through training, experience, and a healthy dose of introspection they learn how to make quick decisions. They learn to work with different personalities. They learn to nurture, motivate, and inspire.

They learn to truly lead.

And in time those skills become automatic and reflexive. While great leaders do a tremendous amount of thinking, that thinking happens behind the scenes. In the moment, in the trenches, when people look to them and need them most, they act: swiftly, decisively, and confidently.

Want to become a truly outstanding leader? Work hard to do these eight things naturally, automatically, and instinctively:

1. Praise. It's easy to tell when employee recognition is simply one entry on a very long to-do list. We've all been around people who occasionally--and awkwardly--shake a few hands and pat a few backs. No matter how hard they try to fake it, their insincerity is evident.

No one gets enough praise, so truly outstanding leaders see expressing thanks, giving praise, and providing recognition as one gift that can never be given often enough.

Praise is almost like breathing to a truly outstanding leader: natural, automatic, frequent, and most of all, genuine and sincere.

2. Decide. Ideas are great but implementation is everything. Outstanding leaders quickly weigh, assess, decide, and then immediately act--because decisiveness and action build confidence and momentum.

That's why making a poor decision is often better than making no decision at all. Mistakes can almost always be corrected. Even though you should always try, rarely must you be right the first time. Adapting and learning and revising so you get it right in the end matters a lot more.

Especially when you...

3. Take responsibility. We all make bad decisions. What matters is what we do after we make those mistakes.

Outstanding leaders are the first to say, "I was wrong." Outstanding leaders are the first to say, "I made the wrong choice. We need to change course."

Outstanding leaders instinctively admit their mistakes early and often because they're quick to take responsibility and because they desperately want to build a culture where mistakes are simply challenges to overcome, not opportunities to point fingers and assign blame.

4. Communicate. Business is filled with what: What to execute, what to implement, what to say, and sometimes even what to feel.

What's often missing is the why.

That's why so many projects, processes, and tasks fail. Tell me what to do and I'll try to do it; tell me why, help me understand why, help me believe and make that why my mission too...and I'll run through proverbial brick walls to do the impossible.

Managers stipulate. Outstanding leaders explain. And then they listen--because the most effective communication involves way more listening than talking.

5. Set the example. Say you're walking through a factory with the plant manager and you see a piece of trash on the floor. There are two types of people when that happens:

One spots it, stops, struts over, snatches it up, crumples it like a beer can, and strides 20 feet to a trashcan to slam it home. He's picked up the trash, but he's also making a statement.

The other veers over without breaking stride, picks it up, crumples it up, keeps talking, and doesn't throw it away until he comes across a convenient trashcan. He's not thinking about making a statement. He just saw a little trash and picked it up without thinking.

Simple example? Sure. But extremely telling--especially to employees.

Why? Employees notice what you do. When you're in charge, everyone watches what you do. The difference lies in how you do what you do... and what that says about you.

Outstanding leaders do what they do simply because it's important to them. It's part of who they are. They care about go, not show--and, in time, so do they people they work with.

6. Give feedback. We all want to improve: to be more skilled, more polished, more successful. That's why we all need constructive feedback.

Because they care about their employees, not just as workers but as people, outstanding leaders instinctively go to the person struggling and say, "I know you can do this. And I'm going to help you."

Think about a time when a person told you what you least wanted to hear and yet most needed to hear. They changed your life. Outstanding leaders naturally try to change people's lives. Even if it's uncomfortable. Because they care.

7. Seek help. At some point, most people in leadership positions begin to avoid displaying signs of vulnerability. After all, you're in charge of everything, so you're supposed to know everything. Of course that's impossible. You can't know everything about your job. Your employees can't know everything about their jobs, either.

Outstanding leaders don't pretend to know everything. (In fact, they purposely hire people who know more than they do.) So they naturally ask questions. They automatically ask for help.

And in the process they show vulnerability, respect for the knowledge and skills of others, and a willingness to listen--all of which are qualities of outstanding leaders.

8. Challenge. Most leaders implement their ideas by enforcing processes and procedures that support those ideas.

For employees, though, engagement and satisfaction are largely based on autonomy and independence. I care a lot more when it's mine: my idea, my process, my responsibility. I care the most when I feel I am depended on--and given the authority--to make important decisions and do what's right.

Outstanding leaders create broad standards and guidelines and then challenge their employees by giving them the autonomy and independence to work the way they work best. They allow employees to turn "yours" into "ours," transforming work into an outward expression of each person's unique skills, talents, and experiences.

That's a challenge every employee wants to face--and one that outstanding leaders instinctively provide.

Categories: Small Business News

Are You a Terrible Manager? Or Just an Imperfect Fit?

Inc Small Business - Sun, 04/20/2014 - 2:00am

Hiring for company-wide cultural fit is important. But perhaps more critical is matching the work styles of hopeful employees to the managerial styles of their bosses. Here's how.

A few years ago, the CEO of a high-tech software company asked me to augment a planned training session with a segment based on Blanchard's Situational Leadership model. The company's managers had just taken a two-day course on this subject, and the CEO wanted to help them better manage new hires.

I read the book and quickly concluded the idea wouldn't fly. The big problem: I didn't see how managers could modify their leadership style to meet the coaching and training needs of each new hire. Instead, I suggested hiring people who already fit their future boss's approach to management. I later called this concept Managerial Fit and described the process in The Essential Guide for Hiring.

The candidate assessment starts by first categorizing managers into six basic styles based on how hands-on or hands-off they are. During the interview, candidates are categorized into six companion styles based on how much support and direction they want and/or need. The two styles are then compared to determine their Managerial Fit.

Basic Managerial Styles: How Managers Manage Their Team Members

Some managers overdo it. Others don't do it at all. As you read the following descriptions, position yourself and/or your manager on the grid from very controlling on the left to largely uninvolved on the right. Most managers have one dominant style but are flexible enough to deal with situations that require adjacent styles. For example, coaches can normally become trainers or delegators as necessary.

1. Controller: This is the directive micromanager style that oozes "my way or the highway."

2. Supervisor: These people need to tightly control a repeatable process using metrics and constant follow-up.

3. Trainer: These managers excel when working closely with people to teach them new skills. The best have the ability to back off and let people learn on their own.

4. Coach: These managers tend to work best with people who have most of the skills needed to do the job, but they are more than willing to coach them through new or problem areas. On an ongoing basis, they provide regular guidance, support, and feedback.

5. Delegator: These managers provide broad direction and regular feedback. They typically agree on the results needed but leave the detailed process up to the person.

6. Hands-Off: These managers tend to provide very little direction and limited feedback. They won’t intervene unless things go awry.

When interviewing people for management positions, I ask candidates who they like to hire and why. This allows me to assign them into one or more of these categories.

Typical Subordinate Styles: How Staff Members Need and/or Like to Be Managed

Some people need more direction than others and some want more than others. When I ask candidates to describe their major accomplishments and where they’ve excelled, I find the role the manager played. Patterns quickly emerge, depending on how much support, direction, and training the person needs.

1. Dependent: These people need constant direction, follow-up, support, and handholding.

2. Structured: These people perform best when required to do repeatable tasks on a continual basis.

3. Trainable: These people have the ability to learn and apply new skills but need extra support and coaching before they're left on their own.

4. Coachable: These people have the basic skills but are more than willing to take direction in areas where improvement is needed.

5. Manageable: These people prefer to be given lots of leeway in how the work needs to be done but are very amenable to support during the planning phase and in reviewing results.

6. Independent: These people prefer to be given broad direction and full responsibility for achieving the agreed upon result.

Managerial Fit problems occur when the manager's style does not complement the subordinate's needs or wants in terms of training, direction, and support. Problems occur on the extremes, or where the manager or subordinate isn’t flexible. For example, a very controlling manager hiring someone who requires more independence is a recipe for frustration and underperformance. Expect similar problems with a strong delegator-style manager who hires someone who needs extra coaching and direction.

Otherwise good people tend to underperform for three big reasons: the work itself isn't appealing or motivating, or they don’t get along with their manager.

Good managers underperform when using a skills-based job description to define the work, which leads to hiring people who aren't motivated to do the work since it wasn't clarified properly, or demotivating these same people by over- or under-managing them. Managers control the complete solution. Defining the work upfront using a performance-based job description will solve the first problem. Conducting a performance-based interview will solve the second. And even if the person isn't a perfect manager, understanding Managerial Fit will minimize the third.

Not doing anything won't help a bit.

Categories: Small Business News

How John Doerr and VC Firm Kleiner Perkins 'Swing for the Stands'

Inc Small Business - Fri, 04/18/2014 - 1:59pm

In a lecture at Stanford's business school, the Kleiner Perkins Caufield & Byers partner talks about the most important lessons he has learned in his years investing in new ventures.

Categories: Small Business News

7 Productivity Apps You Can't Live Without

Inc Small Business - Fri, 04/18/2014 - 1:05pm

Get even more done with some of these new and updated applications.

Whether you're an avid user of personal productivity apps or you're downloading one for the first time, consider this refreshed list of options. -- Laura Montini

A Magneto Calendar was designed for quick meeting scheduling. It gives users a clearer idea of one another's available times by allowing them to share snapshots of their calendars--with the option of leaving out all of the details. After one user draws a box on the calendar to propose a meeting time, the other accepts or rejects it. The iOS app syncs with both Microsoft Exchange and Google Calendar and is available for free in beta.

Categories: Small Business News

3 Ways to Motivate Salespeople With More Than Just Money

Inc Small Business - Fri, 04/18/2014 - 1:01pm

Sales contests can be a valuable opportunity to coach members of your sales team and get them to work together better.

Stop for a second to think about what really motivates a salesperson. Recent research from Aberdeen Group found that the No. 1 motivator is money. (Shocker!) Following that is competition with peers and recognition for a job well done.

Sales leaders focus on financial motivations by giving commissions and employee bonus plans that rightly reward the end result--closing business. However, capitalizing on salespeople's desire for competition and recognition is often missing.

Research from McKinsey showed that praise and recognition from managers is the most effective way to motivate employees, yet only 41 percent of leaders actually offer much praise. And advisory services firm CEB finds that coaching from a manager accounts for a 17 percent increase in sales performance, making the difference between those who make and miss their sales numbers. This is a big reason why sales coaching tools such as Work.com, which show managers other ways besides financial incentives to motivate reps, are seeing such explosive growth.

So what in the world does this have to do with sales contests?

When a manager runs a sales contest, the purpose is typically to create energy and focus around some key sales initiative. That might be taking a new product to market, getting more face-to-face meetings with clients, or upselling to existing clients. (Here are some more examples.) But to make a contest really take off, a manager needs to use it as an opportunity to work more closely with the team and get team members working with each other.

Here are three ways to maximize the impact of your sales contests by aligning them with coaching moments.

1. Launch

Talk with your team about why you're launching this initiative and how they will be measured, so the team is fully aligned. Let's say you're trying to quickly onboard some new salespeople. You can explain to the new recruits that you want them to get off to a fast start, and the best way to do that is to get them pitching one or two specific products that you know are easy to understand and sell.

A contest helps here, as it makes all the participants aware of how others are doing, and makes the onboarding process a little more interesting. This is particularly helpful to get teams in different offices working together more.

2. Get executives to chime in

After the contest goes live and the leaderboards start to populate, get a key executive to weigh in. It could be something as simple as an email or Salesforce Chatter post to the team such as, "Hey gang--thanks for putting your attention around this key initiative for our business. Kudos to Jen, Dave, and Jessica, who are off to a fast start here! Who's going to give them a run for their money?" That simple message will go a long way by recognizing people for a job well done and showing further evidence of the importance of the initiative.

3. Coach performance

Sales numbers are often shared publicly, but coaching reps to actually get more sales can be difficult. Real coaching gets into the weeds on the behaviors and approaches that lead to sales. A sales contest brings that to life, as it creates attention around a key initiative and presents results in an objective way, on a leaderboard that gives you data you can use in your coaching.

For example, let's say one of your team members is in the middle of the leaderboard. With those results so front and center, this is a fantastic opportunity to understand what they're doing and share your thoughts on how they can perform even better. It also opens the door for reps at the bottom to have a discussion about what they can do to take home the victory the next time around.

So the next time you're looking for better ways to coach your team, think about using contests as a catalyst.

Categories: Small Business News

3 Ways to Lead the Way in Your Industry

Inc Small Business - Fri, 04/18/2014 - 12:15pm

If you aren't first, you're last. Don't let your company get left behind.

No business can afford to blindly follow the crowd. Your company needs to be driving innovation, not sitting in the passenger seat. You need to be ahead of the trends.

I recently talked to RED Interactive Agency's CEO, Brian Lovell, and president, Donny Makower, about leading the way. RED Interactive Agency is a full-service digital agency that works with big clients, from Disney and ESPN to MasterCard and Guggenheim Partners.

"A lot of people in our business are driven to either change audience behavior or follow it," Makower said on the topic of staying ahead of trends, "and the truth is, you have to be ready to do a little of both."

Leading the way isn't easy in any industry, but here are three lessons the team at RED learned about staying ahead of the pack:

Get Clients Involved

Whether your company is focused on clients or catering to customers, far too many organizations encourage an approach that is too hands-off. The best work happens when everyone is working to accomplish the same goals.

"Our mission is to always be learning as much as we can about our client's business, and to work closely and collaboratively to reach the goals we set together," Lovell said. "We try to push the limits strategically, creatively, and technically to achieve success."

For RED, this means building tools and technologies to get clients involved in the process. A collaboration with Lionsgate and Microsoft's Internet Explorer group centered on the new Hunger Games film, created the Hunger Games Explorer website, which logged nearly one billion Twitter impressions in the first 24 hours of launch, and has over 15 million pageviews to date.

By fostering a collaborative environment with your clients and customers, you can use those relationships to provide greater quality. Enmesh yourself in your client's world or your target customer's way of thinking. By looking outside your company to deliver the best results, you'll be learning what your company needs to do to cater to your target demographic.

Encourage Teamwork and Collaboration

Teamwork with your clients is important, but teamwork within your organization is essential. You need your best people working together, sharing ideas, and not being afraid to fall down in the pursuit of something new. This means creating a culture of innovation and collaboration.

According to Lovell, the key to great teamwork is threefold: people, culture, and workspace. The agency goes out of its way to recruit the best people, whether they're local or a plane ride away. These candidates go through a lengthy interview process, complete with assessments, to ensure they have the right skills and are a cultural fit.

"We believe great ideas can come from everyone at the company," Lovell said. "We empower our employees to think beyond their job description and encourage them to have a voice in the creative process."

The company organizes informal brainstorming sessions called "concept-a-thons" in which employees from every department come together to work on a new project or toss around ideas. These brainstorming sessions let employees get out of their boxes, foster new skills, and stretch their creative muscles. It also provides projects and existing teams with fresh ideas and innovative concepts to explore.

Finally, the workspace at RED is built with collaboration and teamwork in mind. The office has lots of open space and communal areas for brainstorming and collaborative work, while also featuring work pods for when employees really need to hunker down with their project and get things done.

People, culture, and workspace all set the tone for your company culture and feed into each other. If you're ignoring any part of this three-tiered approach, your company and your best people are suffering.

Be Mindful of Trends--But Don't Stop Forging Your Own Path

Forecasting trends isn't easy; if it was, we would all be ahead of the pack. Though you need to get off the beaten path and make your own way to be successful, it's downright foolhardy to ignore what's happening in your industry. You need to strike a balance between being trendy and being forward thinking.

"An overwhelming part is simply listening to people," Makower said. "After all, trends are just expressions of human behavior, so it's imperative to listen to what people want and where they want to go."

Thank goodness, this should be easy if your team and your clients are collaborating seamlessly. Encouraging a collaborative culture is really the best way to stay ahead of the trends, forecast the Next Big Thing, and pivot before you end up in the lurch. When many voices are part of the conversation, you can truly listen to everything your team and clients have to say.

"You want to consider the trends, but you don't want to be handcuffed to them," Makower said. "It's about doing what's right, not only what's popular."

What do you think? How do you foster collaboration? How do you stay ahead of trends? Share in the comments!

Categories: Small Business News

How to Track Your Employees' Productivity Without Becoming Big Brother

Inc Small Business - Fri, 04/18/2014 - 12:11pm

The Quantified Self movement has tremendous potential in the workplace--just don't use data analytics technologies to monitor people's bathroom breaks.

People are going crazy for self measurement. Fitbits and FuelBands track our activities and sleep. Mobile apps have gone far beyond counting calories to support mood tracking, time spent meditating, and the progression of chronic disease. There are bathroom scales that feature Bluetooth so they can tell your phone how you're doing with your diet. (It won't be long before your phone reports back to your refrigerator.)

But while the "quantified-self" movement is a multibillion-dollar industry, the idea of a quantified workplace lags far behind. To be fair, there are some companies that have benefited greatly from workplace analytics. Call centers saw tremendous productivity improvements as they rolled out better measurement tools in the '90s. UPS reduced its fuel consumption by more than a million gallons a year by optimizing driver routes with its "right turn only" rule.

On the other hand, workplace analytics can be creepy. European supermarket chain Tesco has employees wear electronic armbands so managers can track how fast they walk around the warehouse, but workers complain their bathroom breaks are measured too. Other companies are tracking their employees' non-work activities, including eating, exercising, and sleeping habits. The federal government has built a system that monitors the work-related and personal activities of more than 5 million of its employees to flag those who might be a security risk.

Stories like these raise questions about how far employers can go to keep tabs on their workforce. The state of California even passed a law making it illegal for companies to implant microchips in their employees after some companies began evaluating that technology as a replacement for issuing keys.

Declining Productivity

But creep factor aside, employers need to take this seriously. Lost productivity in the workplace is a huge problem. A 2013 Gallup survey found that 70 percent of American workers are either "disengaged" or "actively disengaged." My company, Enkata, has conducted research that found even a small number of actively disengaged workers can have an outsized impact on overall productivity.

And the problem is getting worse. There are more and more distractions in the office, from smartphone games to online cat videos. Telecommuters have even more things that pull them away from their desk, and some have a hard time staying focused. When announcing her company's ban on telecommuting, Yahoo CEO Marissa Mayer cited VPN usage data that showed many remote employees weren't even logged in for most of the day. Other large employers including Best Buy and Hewlett Packard are following suit in scaling back telecommuting.

Effective Quantification

But the quantified-self movement is about making positive changes, and the quantified workplace needs to be positive as well. No employee wants to work for Big Brother, and no good manager wants to be Big Brother. Employers need to find the right balance to maintain effective oversight without killing their culture and driving away their best employees. This can be done, but it isn't simple.

First, the program needs to be about improving, not policing. Think personal trainer, not overbearing parent. Some companies offer spyware-type products that secretly record everything that happens on an employee's computer but do nothing to help anyone get better at their jobs. Worse yet, they reveal a distrust of the workers that will alienate employees.

Second, employees need to be involved. They should know what information their company is capturing, as well as when the company is taking it and why. They should have the same access to the data as their managers, and they should understand how the company will use the information. If they believe the program is in place to help them, they'll be more welcoming.

Third, employers should be very clear that they won't "sweat the small stuff." Even hardworking people check Facebook once in a while. People's productivity has peaks and valleys, and everyone has days when they have a hard time getting things done. Improvements come from identifying and changing problematic patterns of behavior, not from triggering alarms every time someone does something out of policy.

Finally, companies should follow through on the process of using the information to actually help people. Too often, useful information is ignored because managers don't have time to share it with employees. In the worst-case scenario, information is captured for months, but the first time the employee sees it is in a negative performance review.

As computers and technology become more pervasive, people are seeing them as more intrusive. But it's also the case that computers and technology have given people unprecedented freedom in the workplace. They can stay connected with the outside world, blend their work life with their personal life, and even work completely out of sight of their managers and co-workers. To help managers in the new workplace, you must give them the oversight abilities and tools they need to help employees perform at their best.

Categories: Small Business News

Facebook Might Be Planning a Very Smart Pivot

Inc Small Business - Fri, 04/18/2014 - 11:23am

A banking license? For a social network? Here's why Facebook's latest move is more forward-thinking than it seems.

Facebook wants to bank its financial future on more than online advertising. In fact, the company wants to become a bank.

According to the Financial Times, Facebook is awaiting authorization from Ireland's central bank to become an "e-money" institution, which would allow users in that country to store money on the site and make payments to individuals throughout Europe.

In addition, Facebook has allegedly been in discussions with some startups in the international money transfer business, including mobile solutions.

Is this a smart move or a desperate pivot à la Google Glass? Probably a bit of both, and that offers a lesson for entrepreneurs.

A Little Bit Desperate...

On one hand, things are going well for Facebook. Revenue in 2013 was up 55 percent over 2012; earnings climbed by more than two-thirds. By the end of the year, monthly active users were up by 16 percent.

And yet, all is not bright. Pressure on advertising rates continues to squeeze companies. Google got punished in its earnings call the other day, even with 19 percent year-over-year growth. Aside from questions about the wisdom of Google's acquiring and then selling Motorola, the true issue was the price of ads. Even as the number of paid ad clicks climbed last quarter compared to 2013, the average price per ad dropped by 9 percent.

This particular story has been ongoing for some time. Google is getting more thoroughly into mobile ads, where prices are lower because they don't seem to do as well for advertisers. And regular ads are getting less expensive, as smarter ad buying, alternatives, and other factors keep the pressure up.

Yahoo just saw a similar pattern. Even though Wall Street was delighted that revenue for display ads was finally up 1 percent instead of down single digit percentages or more, the story was volume was up 7 percent, while price per ad was down by 5 percent.

The people who run Facebook aren't stupid and they can see the industry trend. Sustaining the growth that its investors expect will only get tougher so long as the price for ads continues to drop. Plus, its user expansion comes in regions where the ad revenue per person is a fraction of what users in the U.S. and Europe generate.

But Also Pretty Darn Smart

That's the desperation. Now for the smart move. Facebook has continued to become stronger in mobile. The basic premise for a smart business pivot is the rough opposite of the "innovator's dilemma," Clayton Christensen's concept that when companies become big, they get too dependent on their once disruptive, now cash-cow products and services. Management goes into denial over potential new disruptions that could tear their business apart.

In the smart business pivot, management looks at disruptive forces and recognizes that it may have to cannibalize its current strategies to avoid being made irrelevant. Just as importantly, though, the company looks for new opportunities in the disruption.

Facebook sees the wave of disruption that mobile offers. It has undertaken various attempts to make its mobile software more attractive to both users and advertisers. Facebook even tried to push a software package that would effectively make it the top screen on Android phones, though it found little interest.

What Facebook does have is a massive number of mobile users. The question now becomes what else these users might want. Payment systems have become a standard answer. And payment card companies, banks, telecom carriers, electronic payment systems such as PayPal, online conglomerates including Google, and others are all trying to get into the game.

However, Facebook has an enormous advantage: relationships with well more than a billion consumers globally. It effectively overcomes the serial balkanization of hardware vendor, operating system, and wireless carrier.

And as Leonid Bershidsky writes at Bloomberg, it may be that Facebook is aiming at the developing world:

Facebook has about 100 million users in India. One can send the euro equivalent of $200 from Germany to India for $1 in a matter of days using a London startup called TransferWise, set up by Skype's first employee Taavet Hinrikus and another Estonian, Kristo Kaarmann. Facebook might be able to improve on that by guaranteeing instantaneous transfers, and perhaps by offering lower prices, because it is so huge. Facebook is reportedly talking to TransferWise and its peers about some kind of partnership.

Bershidsky argues that Facebook would have to enter the remittance business to get cash to people. Perhaps--though in the last quarter of 2013, the company had a total of 1.2 billion monthly active users, with 368 million of them in Asia. If you have enough people already using your banking service on smartphones, do you necessarily need remittance businesses to hand cash to people? (However, it likely would make the overall business more effective.)

The point for entrepreneurs is that no business lasts forever. What can continue to thrive are relationships with customers. Focus on them and keep asking how new technology might let you provide even more value. That's the way you keep a business going.

Categories: Small Business News

7 Reasons You Need to Manage Your Online Presence More Carefully

Inc Small Business - Fri, 04/18/2014 - 10:03am

While CEOs understand the value of meticulously maintaining their company's image on the Internet, most don't pay enough attention to their own.

If I had a dollar for every CEO I've met who thinks his online presence is unimportant, I'd be a one-percenter. In today's column, my colleague Sam Ford, co-author of Spreadable Media, argues why it's critical for every CEO to pay close attention to his digital footprint. Take it away, Sam.

Often when I've met with CEOs and their teams at companies that are experiencing or poised to experience high growth, we've discussed the issue of how the executives manage their online profiles. This includes bios and other material from the company, social network profiles, speaking engagements, media mentions, press releases, articles she has written, comments about her from people outside the company, or anything else that comes up when you search for her name.

And the most fundamental question they ask is how and why that process is a business priority. Based on lessons learned (sometimes painfully) here at Peppercomm and elsewhere, here are my seven most common responses.

1. You typically have a digital profile, even if you aren't active in social media or online publishing.

Many executives over the years have told me that they aren't active in online communication and thus don't have a profile to manage. But of course any public appearance you make, article you're quoted in, or other public mention of you may be shared online, meaning that you do, in fact, have a profile that's available to anyone who types your name into a search engine, whether you've actively managed it or not.

2. Without management, your online profile may be confusing.

We've represented young entrepreneurs who have yet to build a holistic online presence, as well as serial entrepreneurs whose various business endeavors paint a picture online that doesn't seem to fit together. Without active management, your profile may be painting a misleading, outdated, or less-than-strategic picture of who you are.

3. Having a strong online profile is about reputation, not vanity.

Many executives say they care about their company rather than their own profile. But recent press hits, videos in which you address the issues in your industry, or an ongoing column at a leading publication in your field give you a higher degree of credibility, which in turn bolsters the reputation of your company. As your organization grows and you start branching out to audiences outside those that already know you, that individual reputation may be key for your business.

4. You want to show rather than tell your customers and potential employees about your passion and leadership as an executive.

Corporate bios highlight what you've done, but a compelling online presence includes materials that demonstrate your expertise, passion, vision, and leadership. Executives who take the fullest advantage of their digital profile infuse some of their personality into what you find about them online as well. For customers and recruits to believe in your company, that presence is much more authentic and telling--as well as cost-effective--than scores of traditional marketing materials that try to tell people who you are.

5. Reporters' online research is key to their choice of sources to interview for a story.

Journalists are working on deadline and often must be economical in the sources they choose to interview or the companies they choose to feature. They need someone who's knowledgeable and charismatic, and who has a strong reputation. Many times, all the pitching in the world from a media-relations partner like our firm won't matter if the journalist looks you up and they aren't impressed by what they find.

6. Investors and other key business audiences will be watching.

I've heard from colleagues working with high-growth companies that investors are increasingly looking to the online reputation of a company and its leadership to make decisions about where to put their money. For companies looking to raise capital, the strong presence of the executive in charge might be the difference between ripening and withering on the vine.

7. Often you have competition for your name, which means there can be a lot of clutter in search results.

Unless you have a unique name, there can be a lot of other professionals' profiles to sift through when people look you up. For me, "Sam Ford" is also the name of a Washington, D.C. journalist, a rock and roll drummer, several college athletes, and a porn star. That means there are a lot of competing pages (and pictures) to contend with if people look me up. It has been my goal to make sure that compelling content about me is easily found amid all that competition.

Whether or not online sales or social media are a vital part of your go-to-market strategy, making sure you have a strategic online presence that truly reflects who you are is crucial to building your business.

Sam Ford is director of audience engagement at Peppercomm and co-author of Spreadable Media: Creating Value and Meaning in a Networked Culture (NYU Press, 2013). He is an alumnus and affiliate with MIT's Program in Comparative Media Studies/Writing and acts as co-chair of the Ethics Committee for the Word of Mouth Marketing Association.

Categories: Small Business News

One Simple Tip for Making Good Decisions

Inc Small Business - Fri, 04/18/2014 - 10:00am

There are three kinds of decision makers--but only one type gets the best results.

While it might be true that good leaders excel at consistently making good decisions, great leaders try to involve others in the process, at least when there's the time and opportunity to do so.

That's according to John Canfield, management consultant and author of Think or Sink: A Parable of Collaboration. Canfield says leaders fall into one of three categories: the competitor, the accommodator, or the collaborator. Whereas the competitor isn't worried about getting buy-in from others before making a decision, the accommodator is overly concerned with it. As a result, neither achieves an optimal outcome.

In contrast, the collaborator gets input from others who have ideas that can help make the best decision or who can support the decision later down the road.

"The principle that you're taking advantage of here is people support what they help create," Canfield says. "And so, assuming I have the time for dialogue, I would want to get this group involved in not only coming up with the ideas but then sharing the ideas to some sort of a scoreboard, some listing of a goal. When the team can have that kind of conversation--I'm going to call it robust dialogue--and when they're truly collaborating, the best idea wins."

The Power of Robust Dialogue (a.k.a. Brainstorming)

A simple brainstorming session can do the trick, but these three kinds of leaders may handle these sessions differently.

A competitive leader might sit at the head of a table and ask people to voice their input in an environment of social pressure. Even if a decision is made, little buy-in accompanies it.

A session led by an accommodator might be more enjoyable and include things like snacks and lots of encouragement, but the goal the team is working toward may be unclear and the quality of ideas may suffer.

To be a collaborative leader and get far better results, Canfield suggests first visually delineating desired results on a scoreboard and giving team members five minutes to write ideas for a decision on Post-it notes in silence, with no social pressure. When the time's up, gather the group around a flipchart or white board and take turns offering individual notes, which can then be collaboratively organized and compared with the goals defined at the outset of the meeting.

"So in a much shorter period of time, I get a data-driven decision about what our goals are that everybody contributed to. And because it was on Post-its, I'm able to move the data around and make it more useful," he says.

Categories: Small Business News

5 Things Anyone Can Do to Be More Self-Confident

Inc Small Business - Fri, 04/18/2014 - 9:15am

A new book tells women how to boost their self-assurance, but the advice is good for men, too.

I just listened to one of the most interesting interviews I've ever heard on NPR, It was a talk with Katty Kay and Claire Shipman, authors of The Confidence Code: The Science and Art of Self-Assurance--What Women Should Know.

The interview and book are about women and self-confidence, but the advice I heard on the program applies to everybody, IMHO. Here are the takeaways:

1. Strive for excellent imperfection.

According to the authors, women have a tendency to feel bad if they don't do everything--from how they look to how they parent to how they talk--perfectly. As a result, they sometimes fail to take risks lest they fall short.

In my experience, though, it's not just women who feel this way. I've known plenty of men who are absolutely obsessed with never looking foolish. Heck, I have that tendency myself, which is why I never try to ski, even though I live in New Hampshire.

Regardless of your gender, perfectionism is the enemy of self-confidence because if you're trying to be perfect you'll always find yourself lacking. Instead, try to be excellent or even outstanding--which means falling flat sometimes.

2. Don't apologize before the fact.

Some women, argue the authors, have a habit of saying "I'm sorry" when expressing an opinion or taking action. In the interview, they said that the automatic "I'm sorry" was intended to make the listener feel more comfortable.

I respectfully disagree. I think that people who apologize for doing normal stuff are doing it to make themselves feel better. People (women and men alike) are protecting their self-esteem in case the other person gets upset.

However, to be successful in business you need to offend people. Sometimes, you even need to step on (or at least over) other people to get to where you want to go. That's just the way it is.

Rather than preemptively apologizing, take the action that needs doing, say the thing that needs saying, and then apologize afterwards--if and when it becomes clear that an apology is appropriate.

3. Stop turning statements into questions?

The interview spent 10 minutes or so discussing the habit that some women have of adding a little uptick at the end of each spoken sentence, whether it's a question or not.

While women reportedly do this irritating uptick more than men, I've heard plenty of men do it, and it really flushes their credibility down the toilet, too.

It doesn't really matter who's doing it. The verbal uptick is just a bad habit, similar to the "uhhhh..." pause or peppering your speech with "like" or "you know."

To break this (or any other) verbal habit, cultivate the ability to listen to yourself as you're speaking. Pause before saying something, form the gist of what you want to say, and then deliver it as a statement or a question. Not some weird hybrid of the two.

4. Ignore "mansplaining" (and "womansplaining").

While it may be ironic that I'm writing this, mansplaining is the irritating habit that some men have of telling women what to do based upon analytical bullsh*t.

The flip side to this is when women tell men what they should be feeling and how they should be communicating those feelings, based on some psychological bullsh*t.

What's funny about this is that men do a lot of mansplaining when talking to other men and it's just as annoying. I'll bet the same thing is true of womansplaining among women.

The net effect of all this genderizing is to leech your self-confidence by treating your gender as if it's determinate of your behavior. But that's utter nonsense.

Specific differences between individuals of either gender are almost always far greater than the general difference between men and women. Put another way, men and women alike are from Venus and Mars.

What's important is your behavior--not whether it falls into some preconceived notion of how somebody of your gender should or shouldn't behave.

5. Cultivate your overconfidence.

It turns out that successful people of both genders tend to overestimate what they can accomplish and the value of their contributions. As long as your overconfidence is grounded in the possible, it's a good thing, not a bad thing.

Being overconfident means saying "yes" to stuff that you've never done before. It means being "dumb enough" to really believe you can start your own business and make it successful. Without overconfidence, people don't stretch themselves.

I have to admit that, previous to hearing this interview, I never understood the value of overconfidence. I always thought that it's important to know your capabilities and how to apply them most effectively.

However, the more I thought about it, the more I realized that every accomplishment of which I'm actually proud emerged from me being unrealistic. My writing career is a perfect example.

Everybody I knew told me that I was crazy when I left the cushy corporate world to write freelance full-time. However, I was such a cockeyed optimist about it that I was absolutely convinced it was the right thing to do.

In retrospect, though, it was crazy. Most freelancers struggle for a couple of years then give up, or eke out a living by rewriting marketing brochures. And that was before the newspaper and magazine sectors collapsed.

When I look at my friends (men and women), I see that it's the ones who overestimate themselves who always seem to be doing something exciting or achieving something big. Think of it this way: When you're overconfident, being self-confident is automatic.

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Categories: Small Business News

3 Beliefs of Highly Successful People

Inc Small Business - Fri, 04/18/2014 - 9:12am

High achievement isn't just about what you do, it's also about what you believe, says HubSpot founder Dharmesh Shah.

Here at Inc.com, we frequently round up things you can do to be more successful. That makes sense--we all want to know what we can do to achieve more, but as Hubspot founder and CTO Dharmesh Shah recently pointed out in one of his LinkedIn Influencer columns, success isn’t just a matter of what you do but also of what you believe.

Think about things in an unproductive way and it’s highly unlikely that your actions are going to end up driving you toward success, so if you want to accomplish your goals, it makes sense to start not with tweaking your daily habits (though certainly that's a good idea down the road) but with examining your core beliefs. So what kind of thinking does Shah feel characterizes the "delightfully successful"? He says they share several core beliefs, including:

Self Selection

Business owners are often told not to "ask for permission." Go out there and do what you want to do--approval will follow initiative. Another way to say that (which is perhaps less grating to those who think "don’t ask for permission" sounds self-centered or entitled) is "don’t wait to be selected." Successful people believe they can select themselves.

"Once upon a time most people had to wait: to be accepted, to get funded, to be promoted--to somehow be 'discovered,'" writes Shah. "Not anymore.... You can do almost anything you have the desire and skills and drive to do; you don't need to wait for someone else to discover your talents. You get to discover yourself. The only thing holding you back is your willingness to take the leap and try."

Forget Fate

If you have not yet achieved the success you dream of, it’s easy to fall into the trap of believing you lack a certain something--character, skill, or maybe simple luck--to get ahead. Successful people, on the other hand, know that success only looks predictable in hindsight, and no one is predetermined to fail.

"Success is never inevitable. It's easy to look back on an entrepreneurial path to greatness and assume that every vision was clear, every plan was perfect, every step was executed flawlessly, and tremendous success was a foregone conclusion," says Shah. "Success is never predestined. If you're willing to work hard and persevere, who you are is sufficient--because when you work hard and persevere, who you become is definitely more than enough to do something significant."

Service Beats Selfishness

You might think that the truly great have tunnel vision and focus maniacally on their personal goals. Nope, says Shah. The truly great get that way by trying to be of service to others. "When you're in it only for yourself, initial success is always finite--and fleeting. When you're in it for others, they succeed--and so do you," he writes.

What beliefs do you think are the foundation of success? Let us know in the comments.





Categories: Small Business News

Lessons From Porsche's Customer-Service Fail

Inc Small Business - Fri, 04/18/2014 - 9:00am

Here's what happens when a luxury-goods company ignores a customer's valid and stunning complaints. One million YouTube views later, Porsche is dealing with much more than Nick Murray's lemon.

If I asked, "Which luxury-car company most recently extinguished a big engine-fire problem?" you would probably say Tesla. You would be wrong.

Last month, Porsche reportedly issued a recall for all 785 of its 2014 911 GT3s. An improperly installed fastener led to two fires in European vehicles. The press reported the recall, but no government investigation followed. Porsche simply told drivers to stop driving, and that it would replace the engine. Conversely, Tesla's three fires prompted an investigation by federal safety regulators. Automakers piled on to attack CEO Elon Musk, while dealers claimed he "wants all the profits for himself."

Chances are, you didn't even hear about the Porsche recall--and if you did, you no doubt didn't see reports on the fires themselves. Whereas Musk's detailed response did little to calm the public, Porsche's CEO, Matthias Mueller, was greeted comfortably when he told us that "[Porsche] is not taking any risks when it comes to the safety of our customers." Both acted ethically and properly--one simply exerted significantly less effort. The difference? The Porsche brand is powerful and protected by multiple layers of owners, reporters, and PR movements.

The Blacklist

"The owners all know about the problems, but we're reluctant to tell anyone," says Jack Baruth, editor in chief of TheTruthAboutCars.com and owner of two Porsches. "It lowers the value of the car. [Talking about the problems] makes us seem like status-seeking underendowed simpletons."

In other words, owners fasten their own golden handcuffs, regardless of any risk. "Most of the owners don't expect the car to work every day. We never had," Baruth says.

Porsche's protective bubble has also been built up by an internal PR team that regularly gives reporters "experiences"--invitations to drive beautiful cars in beautiful locations. "Porsche uses the carrot and stick very well," Baruth says. "The carrot is so big that they can and will fly you business class to Sicily to drive mountain roads. It's effectively a $20,000 vacation if you write what they want you to write."

Baruth cited the American Journalism Review's condemnation of car-review standards, which attacks the world of car reviewing for being "replete with expensive perks and fantasy vehicles--consumer advocates need not apply."

The same article also discusses Porsche's blacklisting of Baruth after a scathing Panamera review. Porsche denies that bad press was a motivation for no longer interacting with Baruth, saying "one of the key questions we ask is whether a reviewer writes for a demographic that can afford a Porsche." According to a 2011 media kit, 50 percent of The Truth About Cars's readers earn more than $75,000 a year.

Rewarding allies isn't an uncommon practice in PR. Video-game reporters at times find themselves unable to get games in advance from PR people, meaning they have to buy them on their own, releasing their review later than those that got "code" earlier.

Picking up a $59.99 game is within budget for most journalists. If you can find a Porsche 911 for rent, the cost can easily exceed $290. Per day. To quote Baruth, "Carmakers can make you noncompetitive."

Lemon Law

In today's world, however, reporters aren't the only source of criticism. And it's much harder to shut up an angry, eloquent, and entertaining customer.

Enter Nick Murray, a Connecticut-based Porsche-enthusiast who saved for five years to buy a Porsche 911, and his tale of woe (viewed on YouTube nearly one million times). Upon buying his dream car, Murray says, he immediately ran into problems ranging from self-dropping mirrors to a draining battery to dashboard technology that turned off after hitting speed bumps. According to Murray, he took the car to Porsche for a series of repairs that he was assured would fix the problems. Upon the car's return, it began leaking in the rain--and suffering other problems.

The video suggests that Porsche would not refund the cost of the car or replace it but instead offered to give Murray a percentage of what it thought he'd get through arbitration. It appears--but is not obvious--that Porsche was offering this discounted purchase price for the car; Murray would end up with less money and no car. Porsche did not respond to my request for comment.

Ten years ago, one customer's lemon wouldn't have been an issue for Porsche. Today, Murray's saga has been well documented in passionate, entertaining, and high-quality videos that have inspired a swell of social-media critiques, ranging from regular tweets demanding a refund for Murray to a response from the wildly popular car blog Jalopnik.

On Google News, the buzz around Murray's lemon has pushed down a gushing LA Times profile of Porsche's latest 911. Anyone checking for Porsche 911 news can't avoid Murray's story--and even those simply searching for Porsche will be hard pressed to avoid it. This story also overshadows a Reuters story discussing Porsche's success "looming over" Maserati's sales push.

In essence: One mistreated customer has gut-punched Porsche's PR efforts on the eve of the New York International Auto Show. Two press releases issued in the last day about the 911 are utterly submerged (much like Murray's passenger-side floor) under negative press.

Angry customers (and Internet users) descended upon Porsche's Facebook page, repeatedly posting the video and demanding a resolution. One eventually came. This week, Porsche agreed to refund the full cost of replacing Murray's vehicle. But still, we're left with the impression that he was only an important customer once he recruited an angry mob. And despite the make-good, that Porsche is stuck in a past in which the consumer is the enemy and the brand controls all.

Here are four lessons you can learn from Porsche's public flogging:

1. As a Company, Fix Problems Before They Reach the Press
If a customer has a reasonable complaint (the thing you sold them is, for example, turning off at random), fix it. And if you can' fix it, give the person a new one. Don't hope to weather the storm to save a little cash.

2. You Can't Blacklist Your Way to Success
Samsung's Galaxy S5 recently launched to a particularly lukewarm reception from reporters like Geoffrey Fowler of The Wall Street Journal. This isn't the first time reporters have received review devices and said bad things--and yet the review units keep being delivered. Why? A reporter is not a blank vessel for your brand--you can only control the message insofar as you can tell the press what you know and make a good product. If there's a problem, you cannot edit or blackball your way to making sure people stay in line.

If your product has problems and the reporter reports them, you should have made a better product. Sorry.

3. You're Not the Reporter. She Is. And It's Her Article
Baruth told me a story of a car manufacturer demanding to edit a story he had posted. When he pushed back, he was told "other reporters let me."

I would love to say that this has never happened with my clients. It's very uncommon, but many clients in the past have asked, "Can we see the article before it goes live?" If you want to make a reporter hate you, this is a very good way to do it--you are a PR person. You have no rights to a reporter's work. Ultimately, the reporter is doing you a favor by writing about your client, or you have given the reporter a story--not a press release that you wrote.

4. If There's a Problem, Just Fix It
The other day, I used Shyp, a company that picks up whatever it is you want shipped, packages it for you, and sends it. I asked for two-day shipping, but I was charged more than $50 for overnight shipping. I (rather unprofessionally) lost my cool on Twitter about it. I am by no means a Twitter superstar, and yet Shyp jumped on my tweets, called me, apologized, refunded the difference, and told me about the company's next update, which would include shipping estimates.

Porsche, on the other hand, has not yet issued a full response. Yes, it's significantly more expensive to fix a Porsche. However, a company that sold 50.1 percent of itself to Volkswagen for $5.6 billion and has a history of wooing reporters with expensive trips could have--and especially at this luxury level, should have--simply taken the car away and handed over a like-for-like model. The problem could have been over before it began; now, the brand damage is only getting started.

Categories: Small Business News

Now That You've Destroyed Your Reputation, Here's How to Fix It

Inc Small Business - Fri, 04/18/2014 - 8:50am

If you say or do something that offends your customers or the public, your efforts to save your company and your leadership position have to be authentic and fast.

The litany of executives, public figures, and politicians whose careers have unraveled because of a discriminatory statement, extramarital affair, crime, or even controversial personal beliefs, shows just how easy it is to fall. But when controversy or disaster strikes, you don't necessarily have to go down permanently. America loves to give second chances--but whether you get one depends heavily on how you deal with your scandal.

If you're a leader fighting for a second chance, Eric Schiffer, reputation-management expert and chairman of Reputation Management Consultants, is here to help. His Irvine, California-based company, which ranked #81 on the 2012 Inc. 5000, helps clients including prominent politicians, A-list celebrities, and some of the wealthiest men and women in the world. (Schiffer declined to name any of Reputation Management's clients.)

Schiffer says leaders fall because they don't realize their own responsibility. As a CEO, everything they do and say matters. When a CEO forgets about that aspect of their job, things can go very badly. "Leaders have a responsibility--they carry with them more gravitas and their words have a lot more power," he says. "They have an obligation because of that power to be more sensitive and meticulous in how they communicate to the public, customers, and others who will amplify that message. To the extent to which they want to be involved in politics or engage in controversial issues, they do it many times at their own peril. Not unlike taking a grenade, pulling out the pin, and leaving it on their desk."

If you maneuver correctly when what Schiffer calls the "maelstrom of fury" is upon you, you can return things to normal. "It comes down to authenticity, being a real person, and taking responsibility. Forget all the corporate stuff, business is people," he says. "At the root, people identify with people who are genuine, open, and come from good intentions. People realize people make mistakes and, especially in America, the public is forgiving."

Below, check out the steps Schiffer says you need to take after you make a serious mistake, get swept up in controversy, or get into legal trouble.

Establish your goals.

Say you've publicly expressed your views on political or social issues, and now you're suffering a backlash. Immediately you must figure out what's most important to you--your position in your company or furthering your political agenda. "The leader's first move is to determine what's their goal. Do they want to use their success and position as a platform for secondary gain on a political, religious, or controversial [topic]? Are they willing to pay the price?"

If you decide to continue espousing unpopular opinions and the situation spins out of control, you need to be willing to retreat and make amends, Schiffer says. "In my experience, leaders don't think of these things before the error is made. Part of the process is therapeutic. It's about making a clear distinction on what matters to them at the time, what caused all of this. Make sure it doesn't happen again, and be clean and clear with what we will decide upon, because it needs to be authentic and real."

Decide on a strategy and stick to it.

Once you know what you want from the situation, it's time to hammer out a plan. "Next, you have to decide on a strategy and be very consistent with that strategy," he says. "To me, it's all about accepting responsibility and stating what you have learned. Then you need to share that insight and try to gain forgiveness through making an apology."

Move fast.

This aspect cannot be stressed enough. You cannot let this kind of situation snowball. "Speed matters. You have to move quickly and get in front of it as fast as possible. Then you need to be in front of the decision makers who are deciding your fate--customers, clients, board members, partners--and you need one-on-one communication with them about how you're accepting responsibility and correcting it," Schiffer says. "This has to happen, or else the forces will make your fate. If you don't, the decision makers will be more interested in saving their own reputations and protecting their own turf."

Do a deep clean.

Once you have executed your plan and gained forgiveness, it's time to reinvigorate your reputation and brush the dirt off your shoulder. "After the fury, it's all about cleanup. We focus on the positive things the individual has done, highlighting the good and putting it all in perspective," Schiffer says. "That may mean leveraging the preexisting good things and fine works the executive has done, influencing with our technology, and utilizing our veteran strategists on the Web." If it's a legal problem, Schiffer says, he has a team of media-savvy attorneys to help leaders get out of trouble. "It all requires meticulous care and precision. You have to be extremely persuasive and organic."

Categories: Small Business News

Stop Obsessing Over Exorbitant CEO Pay

Inc Small Business - Fri, 04/18/2014 - 8:33am

It's grotesque, but income inequality isn't as harmful as we think.

This story first appeared in Slate.

Last weekend the New York Times published its annual list of executive compensation, with Oracle's Larry Ellison topping the charts at $78.4 million (and Disney's Bob Iger in a distant second, at $34.3 million). Pay packages have increased by an average of 9 percent since 2012, continuing a steady and spectacular rise even as average wages in the United States and throughout much of the developed world have stagnated.

These figures are often presented as evidence in an ongoing debate that assumes a direct link between the accumulation of wealth at the top of the income pyramid and the stagnation of income for the vast middle and bottom. The Times article quotes the current leading critic of the inequities of global capitalism, Capital in the Twenty-First Century author Thomas Piketty: "The system is pretty much out of control in many ways."

That may be true. Business school professors who study the effect of excessive executive compensation are resoundingly convinced that too much comp hurts the overall performance of companies. Fifty years ago the ratio of average CEO comp to average salaries was 24-to-1; now it is 204-to-1. Many business scholars believe tying so much of CEO comp to stock and the performance of a company's shares incentivizes CEOs to make quarterly earnings look good whether or not it benefits the company's long-term health.

But does the widening gap between the pay of those at the top of the wealth heap and the rest actually harm those who are struggling or sinking? The underlying assumption tends to be an unequivocal yes. It's one of Piketty's claims-;in sync with his overall view that capital benefits capital while chronically undermining wages and labor. Studies by University of California scholar Emmanuel Saez and Gabriel Zucman have been used as Exhibit A in the case for the pernicious influence of wealth inequality. These studies have been the subject of dozens of articles in the past month alone and are part of the corpus of evidence that accumulation of wealth is harming the middle class. Nobel Prize winner and former World Bank Chief Economist Joseph Stiglitz has made similar arguments.

But as New York Times economics writer Eduardo Porter noted recently, claiming that wealth inequality is unambiguously harmful is more about ideology than evidence. He cites the struggles of Harvard scholar Christopher Jencks, a leading chronicler of the middle class, to complete a planned book on income inequality. After years of research, Jencks was convinced that the only true statement about whether and how income inequality harms society is "It's hard to tell." Progressive economist Jared Bernstein has also found that we can't prove the assumption that inequality leads to slower growth, given available evidence. It may be true, Bernstein wrote, but we do not have enough concrete proof.

The work of Jencks and Bernstein complicates the neat narrative of robber barons and a new Gilded Age harming the middle class. Because those views lack black-and-white simplicity, however, they tend to receive less attention. Which is a shame, because they're probably closer to the truth.

The assumption of a causal link between excessive pay at the top and low growth and stagnant incomes fuels the drive to reframe the tax code toward greater redistribution. There is a strong moral case for that, especially insofar as massive gaps between the rich and the rest can be so insurmountable as to severely dent the idea of equality enshrined in the founding of the U.S. That said, even aggressive redistribution will not fundamentally solve what now ails us.

First, this is not an American phenomenon. Capital everywhere--from the corporate CEO in the U.S. to industrial titans in India to party leaders in China--is reaping the greatest rewards of global economic growth. Altering CEO pay structures would do little to alter that trajectory.

The top 100 CEOs in the survey took home a total of $1.5 billion. That's rather nice for them, but redistributing, say, $1 billion of that would do almost nothing to help the 100 million people at the bottom of the economic pyramid in the U.S. Even if you included upper management and got to, let's say, $100 billion, the extra income distributed across American society would barely improve living standards. Boards could mandate that, say, Larry Ellison of Oracle should be less wealthy so that Oracle employees could be more wealthy, but Oracle employees are already on the winning side of the global economic equation. They are not the ones who need help.

Let's say then that you created an inequality tax, as Robert Shiller of Yale has proposed. That could certainly generate some extra billions, which could then be redistributed. But even there, the super-rich would only become slightly less super-rich, while those whose incomes are stagnating or those tens of millions underemployed and caught in a web of structural unemployment would see marginal improvement at best. In short, measures to reduce inequality might be modestly helpful, but they wouldn't solve much.

No matter what redistributive measures we took, we'd still be faced with an economic system in dramatic flux based on the erosion of traditional wage industries in the developed world over the past decades. It is not inequality that has caused the middle class to lag and suffer. Inequality rather is a symptom of a system that reached the limit of what it could provide wage earners performing jobs tied to 20th-century manufacturing.

Ballooning CEO pay is in turn a product of the globalization of capital, labor, and business (as Piketty highlights) without a commensurate evolution of some sort of global government and tax regime. Almost all of the companies that employ the top-paid CEOs are increasingly multinational and answer to no single government. That is a dramatic structural shift of the past two decades, driven by an emerging global middle class.

The focus on compensation has the virtue of a neat explanation for a real challenge. CEOs are paid egregiously; many, many people barely earn enough. But no amount of tweaking executive compensation will generate a vibrant, innovative economy. No amount of redistribution will reinvigorate the American dream or preserve the European system. Only if such tweaking goes hand in hand with a new growth engine--or a rethinking of the necessity of relentless growth--could it be constructive. Obsessing over executive compensation does nothing to contribute toward the hard work of making a generational transition away from the industrial economy that was and toward the information economy that will be.

Also on Slate: "In a Six-Day Period, Nadella Completely Changed Microsoft."

Categories: Small Business News

12 Simple Tricks For Saving Time on Email

Inc Small Business - Fri, 04/18/2014 - 8:27am

Sorting through your inbox can be a huge time suck. Here are a few ways you can make the process more efficient.

Office workers spend about two hours a day on email.

Cal Newport, author of "So Good They Can't Ignore You," argues that this is terrible for your career.

While sending emails might feel productive, he says, it doesn't help you grow your professional skill set.

With that in mind, we gathered these time-saving hacks.

To stop typing the same thing all the time, use "canned responses" in Gmail.

If you're always sending the same email--your address, your elevator pitch, your availabilities for the week--then craft a few canned responses in Gmail and dish them out quickly.

To do so, open Gmail, click on settings, click on Labs, then "canned responses," and then click enable. Or watch this sweet walkthrough, care of blogger Amy Lynn Andrew.

To avoid unnecessary emails, send a text, IM, or just walk on over.

Productivity consultant Jason Womack says to find a way to "escalate high-priority messages" with your colleagues.

If a matter is both urgent and important--and there is a difference--use a different medium than email, like instant message, text, or just walking over to their desk. While emails get lost in a pile, a tap on the shoulder is hard to miss.

Use "the Email Game" to hustle through your messages.

If you want to have some fun and increase your pace as you churn through your inbox, play the Email Game, which turns sorting through emails into a type-as-fast-as-you-can web game. When you open up the Email Game, it syncs with your Gmail. It opens up one message at a time, which you deal with right away and then click onto the next one, all in a race against time. Productivity guru Tim Ferriss swears by it; he says it doubles his inbox-cruising speed.

To slow down the pace of incoming messages, get rigorous about unsubscribing.

If most of your messages are spam or unread newsletters, get rid of them. How? Set a filter for the word "unsubscribe"--which should catch all those unwanted mass mailings--and archive all that stuff immediately. This way you're not actually unsubscribing to the emails, which might have searchable value down the line, you're just shoveling them into a folder.

To sprint through your inbox like an Olympian runs a race, get to know how your email client works.

Business Insider has done a lot of the work for you; watch this video on mastering Gmail or this rundown on Outlook productivity hacks.

To compress your inbox for speed, stop using your email as a to-do list.

Using your inbox as a to-do list is dangerous. Any email you don't act on immediately will get pushed down to the bottom of your inbox by the end of the day. For a better to-do list, try Any.do or Trello.

To aid with sorting the good from the bad, enlist some algorithmic help.

When Harvard Business Review editor Sarah Green set out on a quest to conquer her inbox, she realized she was relying too much on herself.

"I stopped expecting a human brain to solve a problem created by technology," she writes. "I used to feel bad--really bad--when important emails would get lost in the impenetrable wall of unimportant near-spam that took over my inbox every day."

She opted for SaneBox, an algorithmic filtering app that learns what your most important messages are. Those are guided into your now-tidy inbox, while the filtered-out emails are filed away into a "SaneLater" folder.

To keep yourself from getting overwhelmed, make a careful routine.

Some of the greatest artists have had rigorous daily routines. LinkedIn CEO Jeff Weiner shows a similar commitment to sculpting his days--how else could he communicate in a 4,300-person company? As he shared on a LinkedIn post, the routine goes like this:

Wake between 5am and 5:30am; spend roughly an hour on my inbox; catch up on the day's news; have breakfast and play with the kids; workout; go to the office; carve out roughly two hours for buffers each workday; come home; put the girls to bed; have dinner with my wife; and then decompress, typically while watching tv (sporadically cleaning up my inbox via mobile during commercials and the boring parts of whatever we're watching.)

When days get particularly hectic, Weiner says he loses the routine and consequently loses control of the inbox. Thus the importance of forming a habit that sticks.

To save clicks and keystrokes, use keyboard shortcuts.

For example, on Gmail, via Business Insider:

  • (Ctrl + Enter) to send message.
  • (Ctrl + .) to move to the next window.
  • (Ctrl + Shift + c) to add Cc recipients.
  • (Ctrl + Shift + b) to add Bcc recipients.

(Swap Ctrl for Command if you're using a Mac, and the same keystrokes will work.)

On Outlook.com, via CNET:

  • (R) to Reply
  • (Shift+R) to Reply all
  • (Shift+F) to Forward
  • (F7) to Check spelling
To make emailing on a smartphone faster, use Mailbox.

When Mailbox founder Gentry Underwood was first drawing up the app, he realized that most mobile email clients were clunky ports of desktop experiences. So Mailbox redesigned the inbox for mobile friendliness. Unwieldy email threads get condensed down into chat-sized bubbles. Messages get archived with a swipe of a finger. To see more, watch this:

To avoid unnecessary work, quit with the filing system.

Gmail and other clients allow you to set up filing systems to allow users to better organize their inboxes. But it can just get in the way.

"Email folders are categorically the worst way to look for email messages," says Alex Moore, CEO of the email management service Baydin, the company behind the Email Game.

A folder system is self-defeating, he says, because even if you make a bunch of great folders, you might not recall where you put a given message. A search is way faster.

To save you time and get your messages read, write shorter subject lines.

Marketing company Retention Science did an analysis of email replies and found that "emails with subject lines containing six to 10 words were the most effective at getting the recipient to open them up."

As we've reported before, there's a science to subject lines.

Categories: Small Business News

What Aereo Has to Teach You About Being a Disrupter

Inc Small Business - Fri, 04/18/2014 - 8:08am

Aereo's CEO says the Internet is changing every industry, and that's a good thing.

The future of Aereo, an online service that provides over-the-air TV channels, hinges on a battle with broadcasters that goes before the U.S. Supreme Court next week.

For as little as $8 a month, Aereo subscribers in New York and 10 other markets can watch shows live or record them using Aereo's online digital video recorder. Subscribers access programming with computers, smartphones, and other devices, as well as with TVs with Roku or Apple TV streaming devices. Aereo resembles a cable or satellite TV service, except it costs less and is limited to over-the-air channels, plus Bloomberg TV.

Cable and satellite TV companies typically pay broadcasters to include TV stations on customers' lineups. Aereo argues it's exempt because it merely relays free signals. When recording or watching a show, subscribers are temporarily assigned one of thousands of small antennas at Aereo's data centers. Aereo likens its antennas to the personal antennas in people's homes that pick up free broadcasts.

Broadcasters argue that Aereo built the individual antennas specifically to skirt copyright law, as there's no technical reason such a service would need them. Millions of dollars are at stake: If people ditch cable service for Aereo, broadcasters would be able to charge cable companies less.

Oral arguments in the copyright challenge are scheduled to go before the court on Tuesday, with a ruling expected by this summer.

Aereo founder and CEO Chet Kanojia recently spoke to the Associated Press about his company and the industry. Questions and answers have been edited for length, and the order of some questions has been changed to improve flow.

Q: Why shouldn't broadcast and cable companies fear Aereo?

A: What they should be afraid of, and I'm sympathetic to this, is the Internet is happening to everybody, whether you like it or not. It happened to books, news people, it happened to music people, it happened to Blockbuster. There is nothing in our Constitution that says there is a sacred set of companies that will never be affected by new technology.

Q: A lot of people who may think about cutting service and going with Aereo may be reluctant because of the one or two cable channels they watch regularly.

A: The market is going to evolve. If you think about what Netflix is doing (with original programming), it is going to force change in the paid TV business. Here's a channel effectively operating as a paid channel. If Netflix can pay the bills, the next hit show is going to be on Netflix. It's not going to be on HBO. That's going to force the change.

Q: How did you come up with this idea?

A: My last company, we pioneered how to measure viewership in cable systems. When you started looking at the data, it was obvious that nobody watches more than eight channels. Half of them happen to be major networks, which are free to air.

Q: If you prevail, what do you think that will mean for the industry?

A: Change is a long process. I don't think anything is going to change anywhere because of Aereo. What is happening is the entire market base is changing with access to alternatives, whether it's Netflix or iTunes or things like that. Aereo is simply providing a piece of the puzzle. After we win, it's not that a sea change is going to happen overnight. It is just going to be that we will be allowed to continue to fit that missing piece in a consumer's life as they're evolving. These things take decades to play out.

Q: If Aereo wins, a couple of broadcasters have threatened to become cable-only channels so that they can't be shown on Aereo.

A: They're individual companies. They can do whatever they want. I think the question becomes, on an overall-reach basis, you're giving up 60 million eyeballs. That's how many people use antennas in some way, shape, or form, which kind of correlates to about 18 percent of the household basis.

Q: Your Plan B should the Supreme Court decide against you?

A: We don't have a Plan B.

Q: For a $100 million investment, that seems to be a lot of faith.

A: We apply all of our energy in making sure we're ready and continue to grow the business. To me, if we optimize for loss or a potential loss, we give up optimizing for a win. If you believe your position, the only thing you should do is play to win. We've never been dishonest with our investors. Everybody knows what the risks are.

--Associated Press

Categories: Small Business News
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