On Business Strategies, Tactics & Luck

Writing this blog is a double-edged sword. It's easy to deal out advice - it's quite another thing to walk the talk and take that advice. I'll never be perfect, but I will endeavor to be a doer and not just a sayer in all things - that my motto would be; "do as I say and as I do". For that I know of One perfect example to follow.

October 2009 - The business climate is improving but I still see significant reluctance to "get on with it". Tight credit is indeed an impeding factor but I know a lot of good, responsible Lenders who want to do business - but who will not take willy-nilly risks with businesses who don't have a sound business plan and realistic revenue (note that I did not write "sales") forecast. I'm reminded of the saying, "If not you, who? If not now, when?" Where I DO see gumption and a mind to take action is in the smaller businesses. To them I say - make hay and take marketshare while your management-by-absolute-certainty, waiting-for-the-market-to-return, risk-averse, fearful, lumbering larger competitors procrastinate.

The 2009 PGA Tour® regular season may be over and the Fedex® Cup awarded – but professional business is just getting back into the swing of things.

“I love to play golf, and that's my arena. And you can characterize it and describe it however you want, but I have a love and a passion for getting that ball in the hole and beating those guys.” – Tiger Woods

In July - for those on my email circulation only list which has since transitioned to now include this blog - the title was “Execution”. In it I borrowed from Gary Harpst’s, Six Disciplines® – Execution Revolution (© 2008, Six Disciplines® Publishing). I’m going to go back there for a moment and blend what Harpst brings with some related information I’ve uncovered from Guy Kawasaki (of Apple Macintosh fame) who now leads Garage Venture Partners® – and show them side-by-side.

Take a close look at the presentation below. To the left, a visual from Garage Venture Partners® – to the right a visual from Gary Harpst (copyright credits provided above). Note my title at the top:

Like most business graphics of this sort – and as Guy Kawasaki points out, "high and to the right" - - - right? Are you?

I assure you that all your work to achieve a position in the profit zone will inevitably result in competitor pursuit that will inexorably draw you into the commodity zone. Unless you are deliberate to innovate and pursue new niches - WHILE taking profits – you will be sent to the “fire-fighting” corner. It’s classic. To stay in sector II as a strong Unique and strong Value producer – leadership must balance Strategy and Execution. Tough decisions - like dropping tired (though familiar) and perhaps “dear” product lines (you may even believe that some are your very corporate identity) and seeking new and unfamiliar markets - will be required. Small business shows us the way. We are beyond a mass-production based economy and have moved into mass-specialization. Find your specialty, your unique competency (your arena) and leverage it in as many applications as you can - adapting it to as many profitable markets as you can perceive.
This is not comfort zone stuff. Be honest. Where are you on those visuals?

Did you ever think that the core competencies and what can make your organization come alive in its arena may not necessarily be described by your current product line? Rather, they may be better described by your foundational technology, special methods, know-how, networks and market sector expertise. Looking at it that way may liberate you to discover new markets and needs that you can uniquely and profitably satisfy with new products or adaptations of existing ones. Don’t listen to “dead-wood” executives who blame everything on “unsolvable” circumstances like the economy, competition, uneven playing fields, government – yada yada – resigning themselves to forces greater and unknowable. “Maybe if we just hang on – cut more costs, discount again - the market will return”. Heard that tune? What market is that? Demand some imagination.
“Consistency is the last refuge of the unimaginative.” - Oscar Wilde

SHIFTING TO THE TACTICAL - - -

The Deming continuous process improvement PLAN > DO > CHECK > ACT cycle of management works well in most process environments. The esoterics of continuous process improvement, data mining & evaluation, SPC and transitions to “lean” are the “good” stuff of Production Management, Quality Engineering and “Black Belt” excellence. These disciplines fall into the realm of the Profit Taking Zone/Quadrant III – or - the anteroom of Quadrant IV – Fire Fighting. The competitive landscape brings daily competitor and customer maneuvers, changing perceptions of value and pressures that beckon us to focus all of our attention in Quadrant III. Despite pro-active rhetoric and intent, much of what businesses do is in response to unforeseen, mischievous activity. Life is a hale storm of distractions! Consider the atmosphere of a patrolling fighter pilot and his anxiety when his pristine, uncontested aerodrome is encroached by an adversary who wants to plant him and his smoking wreck of a plane into the dirt. Pro-activity needs a champion and some tactical teeth!

Colonel John Boyd (USAF) was an outstanding fighter pilot during the early years of jet propulsion fighter aviation and he is credited with being the father of the modest but nimble and lethal F-16 warplane. Google the Colonel. Boyd also brought us “OODA Loops”. No, it’s not a cereal.
Boyd’s a tactical Deming. OODA refers to a fluid, action-oriented state of mind that integrates Observation with Orientation with Decisions with Actions. The tactical fighter pilot’s version of; Plan, Do, Check, Act. Observe>Orient>Decide>Act. In that order - no element left out. Every observation leads to orientation and a decision – then action – a maneuver. The quicker the better. Some call it “fast cycling”. It keeps you on your toes. Thomas M. Hout of Boston Consulting Group said, “The OODA Loop limbers up your organization. It keeps you constantly worried about the next cycle.” Tighten the loop, outmaneuver, throw-off your opponent – turn inside his radius of ability. “Disorient” your opponent with pro-action. If one competitor employs OODA thinking – it rules on that field of contest. This and the data that comes from observation and orientation of your business in its competitive markets is the “esoteric good stuff” of your marketing tacticians, your sales force and your product development talent. Lead them to it. Thank Colonel Boyd.
On LUCK:


“Luck is what happens when preparation meets opportunity.” - Coach Darrell Royal
“Fortune brings in some boats that are not steered.” - William Shakespeare
“Some folk want their luck buttered.” - Thomas Hardy
“Shallow men believe in luck. Strong men believe in cause and effect.” - Ralph Waldo Emerson
“The harder I work, the luckier I get.” - Sam Goldwyn

What’s luck got to do with it? Napoleon said that he would rather have lucky generals than good ones. What made them lucky? Some historians say that Napoleon had a bad day at Waterloo – does that make Wellington lucky? He can thank the Prussians. And speaking of Prussians, Helmuth von Moltke (Chief of Staff, Prussian Army 1857-1887) considered it the prime responsibility of military leadership to improve their luck factor thru “extensive preparation” for all possible outcomes. His quote, “No plan of operations extends with certainty beyond the first encounter with the enemy's main strength.” (e.g. no plan survives initial contact with the enemy). All of the great strategists from Sun Tzu to Carl von Clausewitz considered the luck factor. I hope this issue of “View From The Crow’s Nest” brings some tools to bear on the topic.

So, eyes on the ball, swing smoothly, follow through and may your results be – high and to the right!


By the way - I’m a successful CEO available to lead a small to medium sized commercial enterprise in transition, recovery or in its growth phase.

All the best!

Bill

- A Call To Captains of Industry -

Ready or not, Autumn is here. It’s time to evaluate the year and the plan and then project for the future. For some companies it’s already 2010. For some, this time of year (especially this year) will be a scramble to execute the annual “plan” before elements of it and its goals must be written-off. The 2009 “plan” will soon be “overtaken by events” …

“We’re drowning in information and starving for knowledge.”Rutherford B. Rogers, Yale University Librarian – 1985 (before the internet explosion …)
At a recent seminar the presenter recalled a professor of one of his business courses who challenged his students to pursue failure early in their careers. Odd advice on the surface. The message – face yours fears head on - take risks. Question: How many people reconfigured their 401(k) portfolios to “max. aggressive” back in March because they believed that a recovery was certain? Crazy? In mid February it would have seemed madness to invest $100,000 in Ford Motor Company stock. Such an investment would have been worth over half a million dollars a few weeks ago. Hindsight you say. I know a man who knows and studies Ford stock, owns Ford cars and knows how that company was and is different than the rest of the automobile companies – he invested when F was $1.50/share - he did “okay”. He invested in what he knew and believed.
Do you run an organization? Are you the expert for running it? Do you have to make judgments about those who do? What do you know and in what do you believe? As we emerge from the recession we are all like fresh graduates – it’s a clear, clean table we have before us - - - the Zamboni has just left the ice! So know what you know, believe in what you believe, act, pursue success and face failure with fearlessness.

Sometimes we forget that the greatest take-away from college was that we learned how to learn. We also learned how to get up after falling down and we learned that we could always change our minds. Now’s the time – it is an uphill pursuit and there are new rules that will require us to do things differently with perseverence, patience and the freshness of youthful fearlessness. That perspective should be exhilharating!

“Love gave me confidence and adversity gave me purpose.”Eunice Kennedy ~ Rest in Peace

The recession has stripped the varnish off and exposed many a management style. Openness, Loyalty, Integrity have all been tested. Nothing has been lost on employees who have been carefully watching - noticing every move made by management in the breech. The present unemployment rate is a dam holding many employees in place – biding their time. When that dam opens some enterprises may suffer an exodus of disgruntled employees (some justified by their action and some not). There is a risk of losing key individuals upon whom were heaped the work of layed-off colleagues for the good of the enterprise. Managers may think – “fine, from the frying pan into the fire”. Before the year is out – it’s a good idea to genuinely recognize where recognition is due. Intelligent employees understand the financial contraints of the economy - so money need not be the only currency of gratefullness. When profits allow – have a memory.

“The six most important words: I admit I made a mistake. The five most important words: You did a good job. The four most important words: What is YOUR opinion? The three most important words: If you please. The two most important words: Thank You. The one most important word: We. The least important word: I.” - Author unknown
This calls for a segue to a discussion on stakeholders. Who are the stakeholders? Years ago while instructing young Ensigns headed for the fleet I was often asked for one pearl of wisdom that would guide them as they entered their new world afloat. I found myself repeating this advice, “In everything you do, ask yourself - what would the Captain do?” An easy statement to casually make, but a leadership concept that actually requires great effort on the part of the Captain and organizational culture, through a chain of command, that enables each crewmember to follow and serve with competence and WITHOUT thwarting creativity, ingenuity and pro-activity amidst myriad variables and unplanned circumstances – a mouthful. True competency is manifested in professional agility. I gave that “sage” guidance knowing that the Captains out there and the Navy would do their part.

What would the Captain do? What would the CEO do? In few other places is the concept of total responsibility and accountability so clear than in command of a ship at sea. The Navy compounds the responsibility by adding dynamic, challenging and second-splitting missions on top of the basic need to stay afloat and get from point A to point B in a completely man-made object (“you can’t walk home from here”) and in the unforgiving, changing and corrosive sea environment where equipment malfunctions are a matter of course. Now do all that with seamlessness, military precision, a largely young population (the average age of a crewmember on a U.S. warship is roughly 19) of mixed race, gender and place of geographic origin and do it in clean - pressed uniforms. A Captain must know and nurture his stakeholders.

So, who are the stakeholders? The Wikipedia definition of Stakeholder in the corporate sense is; a person, group, organization, or system who affects or can be affected by an organization's actions.
Investors, customers, employees, suppliers, lenders, the local community and market are the stakeholders. What “affects” flow between your operation and them. This is the key responsibility of business leadership – stakeholder stewardship. As the business leader – here’s the challenge; to what extent are YOU willing to establish vivid and revealing reporting tools and “transparency mechanisms” that hold you accountable to your stakeholders AND which bring them to a place of knowledge that enjoins them to do their part because they are stakeholders? Doing the right things starts with having the right information upon which to take action. What do lenders and investors say? “No surprises.” Employees, Suppliers and Customers want that too. Can every employee in your enterprise answer the question, “What would the CEO/Owner do in every circumstance? A book that builds on this: The Great Game of Business (by Jack Stack, © 1992 by Doubleday) suggests a way.

“In order to trust, support and anticipate, stakeholders need to know that YOU look at problems and opportunities not in segmented parts, but that you take a watershed view and concern that each stakeholder is thoroughly aware of their role, it’s consequences and the significance of their contribution toward the whole.”

Are you a Scanner or a Diver? We are all created different and companies often make the mistake of driving employees to excel in areas in which they are simply not suited – square pegs jammed into round holes. Robert Lewis, in his program titled “Winning At Home And At Work” points out that individuals who engage in activities for which they are uniquely designed and for which they have certain natural strengths (gifts) are energized by those activites and actually draw energy from exertion in them. Imagine a workforce setup such as that! You don’t have to imagine it – you can have it – even if you don’t have a sophisticated HR department. I can vector you to experts on this!

“A scholar is someone who sticks to something. A poet is someone who uses whatever sticks to him.”- Robert Frost

A network acquaintance recommended a book that provides considerable insight on career focusing and the personalities and “turn-ons” of key employees. The book, I Could do Anything – If I Only Knew What It Was, by Barbara Sher (© 1994 by Dell Publishing) is a journey of personal introspection as well as a platform to understand what makes people tick in their professional capacity. In it you will read about Scanners and Divers. WARNING: This book may hit you right between the eyes. I’m gifting this book to my children.

All the Best!
Bill