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To avoid wasting time at your next board meeting, follow these steps.
Recently I wrote the first post in a series on board meetings entitled, "Why You’re Not Getting the Most out of Your Board," which focused on the need to prepare properly, set good objectives and discuss mostly strategic topics.
Even if you follow this game plan meticulously your board meeting can be taken off course by well-intentioned board members who lead you down a rate hole.
Here’s how it happens …
1. Topic Creep
You start out your board meeting and a well-meaning board member who read your deck noticed a detail she didn’t understand on page 18, "Bob, I noticed that your margins in Canada declined from 48 percent to 46 percent while your margin in Mexico is up by 4 percent. Can you please explain the discrepancy?"
I call this "topic creep" and it is killing your board meeting. It might be useful for Sally to know the answer to this but it isn’t the most valuable use of the time you spend together as a board.
Often this is the first thing that comes up at your board meeting because while you’re sitting around waiting for the meeting to begin some random questions are flying. The question is legitimate and might even be important but unless it’s on your core agenda and immediate focus for discussion it might become a big distraction.
In my experience 90 percent of CEOs would just answer this question on the spot. And what seems like a harmless question with a quick answer it leads into a 15-minute discussion.
It also sets the wrong tone for the meeting as you suddenly are starting on your back foot and trying to defend your performance in part of the business rather than leading the meeting. Plus, if you haven’t prepared to talk about Canada vs. Mexico you might come across as unprepared and the board will pick up on this.
How to deal with "topic creep?"
Simple. Say, "great question" and jot down the question and promise to come back to it later in the meeting if you have time and certainly after the meeting if you run out of time.
In fact, I highly recommend having somebody other than the CEO taking down the key questions that are "parked" so that the CEO can stay focused on running the meeting.
Remember, your goal in a board meeting is to maximize the amount of discussion time you have with the smart people you’ve assembled and get their reactions to the key strategic issues you’re debating internally. You’re looking to get their experiences from other companies and to challenge your thinking.
If your goal is to debate A and you spend all of your time on B because somebody else brought it up -- you’ve failed.
2. Does Anybody Have any Questions?
If it isn’t obvious already, this is an invitation to topic creep. It’s like saying, "Please, I don’t have a plan for our limited time today, what do you recommend we speak about?"
You can always leave time on the agenda for later in the meeting for "open questions" or the like so that people feel like they get to express themselves.
Also, if you read my previous post you’ll know that I believe 1:1 calls with each board member before a meeting will help limit the amount of random questions you get and will also help you surface any real concerns somebody may have and that may be worthy of going on the agenda. The strategic topics you discuss at a board meeting should be a healthy combination of what’s on your mind and what you’re trying to solve as well as what big concerns board members may have about your business.
It’s surprising how often I heard people start with "does anybody have any question" and it is seriously a 0 percent hit rate of a successful opening to a meeting in all of the times I’ve seen it.
3. Can I Just Show You One Thing That Doesn’t Work in Your Product?
Of all the things I’m personally most guilty of it’s this one. For companies that have products I can use on a regular basis I often save up a mental queue of all the things I think could be improved in the product. I often ping the teams as I spot issues but as the board meeting approaches invariably I think, "Well, I’ll just mention it next week."
I would put the product feedback into the same bucket as the open questions about the business. It’s best handled by putting it toward the end of the meeting and/or agreeing to answer these questions right after the board meeting.
4. I’d Like to Intro You To …
My greatest pet peeve on boards is when you have "over introducers." These are people who continually feel the need to connect their portfolio companies with people they think would be interesting.
I resist this whenever possible. Of course there are some sensible introductions that are valuable. But it should always be at the company’s discretion unless you’re asking as a favor, in which case, ask as a favor.
Too many VCs I’ve worked with just send out a ton of intro’s because "I think you’d enjoy meeting each other," and no management team is going to easily turn down that email request out of respect for their board member. But it ends up wasting a hell of a lot of time of key executives.
I bring this up because I’ve seen an insane amount of time wasted at board meetings by people spending time talking about all of the introductions they want to make. And often times it’s to other portfolio companies where there’s some self interest.
I can’t say I’m a zero offender in this category either. But I really try hard to be disciplined about not turning board meetings into intro discussions to prove how connected I am.
Board meetings should be about maximize the amount of time you have with your key directors to debate the issues that are most critical to your business and getting input and buy-in to your key decisions.
If you haven’t read my previous post on how to prepare for board meetings and how to set the agenda see my last post.
Even the most well-meaning board members will be undisciplined about time management and discussing what’s on their mind rather than what’s most important to you.
It’s your job not to let this happen.
Acknowledge the great question. Have a scribe write it down. Commit to come back to it later in the meeting or soon after the meeting. And move on to what you came to your board meeting to discuss.
This article was originally published on Mark Suster's blog, Both Sides of the Table.
Nix these old habits to build a more 'people-minded' business in 2014--and beyond.
As 2013 draws to a close, you're probably evaluating how your business performed and what you'll need to do to improve. Wherever those evaluations lead you, remember that we're in the people economy and one of the most effective ways to grow your business is to connect with your customers in deeper, more meaningful ways.
There's a lot of opportunity in the new economy, but it requires breaking some habits that are entrenched in many companies. As the new year approaches, here are three habits you must break to reach the customer of the future--in 2014 and beyond.
Old Habit No. 1: Focusing on the Top of the Funnel
In the people economy, customer experience matters above all else. Don't think about lead generation as the best way to grow your business. Instead, focus on delivering great experiences that your customers will love. After all, attracting new customers does little good if you alienate them with poor experiences that leave a bad taste in their mouths.
In "Flip the Funnel," Joseph Jaffe explains why customer retention, not customer acquisition, can have the greatest impact on a company's growth. The rules are different in the people economy and companies must turn traditional business growth on its head. Instead of worrying about getting more customers in the door, focus on continually delighting the customers you already have. Not only will you have loyal customers for life, those quality experiences are the surest path to quantity.
Old Habit #2: Treating Customers Like Customers
Gone are the days when it's sufficient to treat a customer, well, like a customer. People are more connected than ever before, and not just in their personal lives. Now, people expect brands to connect with them on their level, and on their terms. If they tweet a complaint (or a compliment) at a company, they expect a personalized response.
Delta Airlines' Delta Assist (@DeltaAssist) Twitter handle is an example of a people-centric interaction that makes a difference. A team of Delta employees constantly monitors Twitter to answer customers' questions and solve problems. Scan the Tweets and see how often Delta's employees use "I." That personal touch can make all the difference for a customer who's stranded in an airport because of weather cancellations or whose bag didn't arrive in Madrid after a 14-hour flight.
Don't forget that your customers are people, and people connect with--you guessed it--other people. Have some personality, be human, and show you care by treating them like friends and family. They'll reward you.
Old Habit #3: Diverting Dollars from Service to Marketing
Companies use marketing to build awareness and to get customers to say good things about them. The most sustainable way to obtain customers is to deliver services and great experiences that keep customers coming back--and get them talking. There's nothing more profitable than happy customers who love your company and feel compelled to spread the word. They have the personal connection and credibility that a banner ad or a billboard just can't match.
Service isn't an expenditure to be line-itemed and cut at all costs. Service is marketing-- and it might be the only form of marketing that works in the people economy.
Charmin's 'Enjoy the Go' campaign is a great example of service-as-marketing. The company's clean, portable restrooms in places such as Times Square during the holiday shopping season, State Fairs, Super Bowls and music festivals provide an essential service. Sure, Charmin could have put up a billboard in Times Square or sponsored the Super Bowl halftime show. But the company was able to engage with people by helping them take care of business. Marketing must provide a service in the people economy.
Customer expectations are always changing. But breaking these three habits in 2014 will help you reach your customers and grow your business in the new year.
The best gifts aren't the most expensive. They're the most memorable.
Corporate gift-giving is making a comeback.
Companies are spending more than $40 for employees and $30 on clients on average, according to the Advertising Specialty Institute, and spending is the highest it's been in four years.
Gift cards, cash bonuses, food and beverages, and apparel are top gifts. However, choosing the best gift depends on the recipient, not on what’s trending right now. A $40 gift certificate to a store might be nice, but might get lost in the shuffle if it doesn't really resonate. Here's how to make a lasting impression over the holidays and beyond.
Give something meaningful.
Perhaps it’s a round of golf or tickets to a game, or a cookbook or framed photograph. The key is really knowing the person and getting something that has real meaning. They'll think of you when they're using the gift and really appreciate it. Which is a good thing since people like doing business with people they trust.
Express your company's values.
This winter at SurePayroll, we gave our employees a branded carrying bag with a branded winter hat, a cup from our parent company, Paychex, and gloves with fingertips that allow you to keep using your smartphone. We wanted to reflect our love of technology, the wintry weather in Chicago, and our parent. And besides, it's free advertising.
Build a relationship.
Survey respondents said some of the best gifts they received were a handwritten thank you, a wall calendar with personalized photos, and a plaque with an inspirational message. So take them to dinner or a sporting event. You'll have several hours to talk and build rapport outside of your business.
Should You Give Holiday Gifts to Your Employees?
Snapchat may not want a $3 billion acquisition offer, but it will take another chunk of VC funding, thank you very much.
Startup darling Snapchat has raised $50 million in Series C funding, according to a filing with the Securities and Exchange Commission. This comes after news that the Venice, California-based company turned down a whopping $3 billion acquisition offer from Facebook last month.
According to Forbes, the hefty round, which puts the photo-sharing app's total valuation at $2 billion, was led by Coatue Management, a Menlo Park-based hedge fund.
"They have already reached an incredible scale," Coatue head Thomas Laffont told Forbes. "And what you do on Snapchat is not something you can do on any other communication platform. We think they’re revolutionizing how people communicate in a mobile-centric world."
Co-founder Evan Spiegel has not yet revealed how he plans to use this latest cash infusion.
The company recently announced that it hosts over 400 million "snaps" per day and that this latest round brings its total investment to $123 million.
The company is also in the middle of a nasty court battle. Just this week, the company's two founders, Spiegel and Bobby Murphy, reportedly filed a restraining order against former Stanford University friend Reggie Brown, who has sued the company claiming Snapchat was his idea. Brown has reportedly leaked sensitive company documents to the press.
His exhibiting of a unique leadership ability is much of the reason why Pope Francis is Time's Person of the Year.
Time magazine named Pope Francis its 2013 Person of the Year. In the past, the title has gone to other notable leaders like President Obama and Mark Zuckerberg. Likewise Pope Francis’ leadership abilities played a large role in his being chosen for the honor. And interestingly enough, he only began his papacy in March.
“What makes this Pope so important is the speed with which he has captured the imaginations of millions who had given up on hoping for the church at all.” Time’s cover article said, explaining why the Pope received the title.
“In a matter of months, Francis has elevated the healing mission of the church -- the church as servant and comforter of hurting people in an often harsh world -- above the doctrinal police work so important to his recent predecessors.”
The fact that Pope Francis has been able to accomplish this much after assuming his position during a period of deep mistrust and tumult within the Catholic church is not lost on those who are following him.
Inc. contributor Bill Murphy pointed out, “With some simple but daring gestures -- from removing the bullet-proof glass on the Pope mobile to rolling down the windows in his car to greet a throng of people when his driver took a wrong turn in Brazil -- this pope has shown an unusually open brand of leadership.”
So what can you learn from the Pope's fresh approach to leadership?
For one you should always ponder what you want your actions to say about you, as the Pope has done time and again, says Inc. columnist Margaret Heffernan.
She recently wrote:
"Before you do or say anything, ask yourself what you want to be known for. Then consider which one or two actions -- not words -- might articulate that. If you are going to have to start cutting costs, cut some of your own first. If you want a flatter hierarchy, get rid of your door. The Pope started by speaking Italian, not Latin, thus signaling a more modern man. Simple but eloquent."
Heffernan outlined more ideas for mastering the Pope's leadership in her recent article, worth a full read.
If you're not sure whether to give your team holiday gifts, consider what kind of culture you want to create, says Michael Alter, president of SurePayroll.
Leaving a giant like Google to launch a startup doesn't mean starting from scratch. Some of the big boys' systems and policies are worth integrating no matter what size your business is.
Four months ago I left Google--an amazing company full of some of the greatest people I have ever met, with an incredibly positive culture that helps you perform better every day--to launch my second startup.
Some days, when having the new team working out of my house gets to be too much, or when I want to explode over the idiotic nature of Citibank's online wire transfer procedures (double authentication that cannot be done through a cell phone), I miss the creature comforts and security of a large company.
Luckily, those days are few and far between. The scrappiness and agility of a small company makes this the best experience of my life. But every day I go against the grain of the so-called "disruptors." While everyone has become obsessed with the lean startup, the idea that gigantic companies are somehow doing something wrong by being so large, I've learned to reflect and understand what big companies do right.
Contrary to popular belief, there are plenty of things that a small company can learn from what the big boys are up to. Here are the three of the most important ones.
The last department that every startup integrates is Human Resources, if only because it seems like the CEO can bring in layers of perks and office goofiness to make up for it. (Indeed, I never want to have an HR function--"People Operations," the term Google uses, is way better.) The culture of "crushing it" has led to the idea that you have to work on your startup all the time. While it's undoubtedly true that people go into a startup knowing that they will work a lot more hours than at a large company, if you invest every waking second you end up not being effective.
Yes, many large companies work people to the bone, but there are specific work and vacation hours. You have an office. You work. You leave. The office is the office, the company is their company. When it's a startup and you are an early employee, that line becomes blurred--it's so much more about personality and personal investment. However, it's hard to be creative and passionate when you are overtired and overworked. That's why I have an under-60-hour-a-week policy for my team. A startup is about people, and destroying someone's personal life in the process will harm the startup.
Comprehensive Employee Review
Many people will roll their eyes at the idea that employee reviews are necessary. But they are, in any company, of any size. When you work for someone, or they work for you, you should know what they think and understand it. Reviews allow employees to improve in areas where they need it. Creating a review process that helps ensure that employees get real-time feedback is something small companies can take from large companies. For example, digital design studio owner Greg Hoy created a 360-degree peer feedback evaluation as part of his fledgling company, but left himself out. When he let himself get reviewed, his employees tore into him.
The natural reaction to any criticism can be (as Hoy experienced) anger, depression, anxiety and other maladaptive psychological conditions. The truth hurts. But the truth that comes out in reviews can improve a company--even a startup with only a few people.
Clear Results, Objectives and Timelines
Conventional wisdom is that startups are built with a lack of strategy--something people associate with the "agility" that means that anything can change or be fixed at any time. They see a corporate goal system as stodgy and antiquated; the idea that someone should directly map out their journey is silly, because startups can change a great deal.
The truth is that long-term strategy with clear objectives and milestones is necessary and actually relieving. Living life as a reactive businessperson results is a guaranteed ulcer.
At Google I saw this in action with Objectives and Key Results (OKRs), a methodology that the company has perfected and lives every day. Google focuses on incredibly specific dimensions and goals to complete a particular task, large or small. It seems exhaustive (and exhausting) to write down everything you are planning to do instead of spending time doing it, but it also allows for the consistent monitoring of the way in which a company is built. Are specific people or specific parts of the company regularly missing goals? Using task management systems like Asana, you can accurately measure these elements. Data entry is dull, but necessary at times to build real, lasting structure and a base from which a company can grow.
True, overreliance on data entry can stifle creativity and innovation. I've seen almost every system known to man that requires you to log calls, tasks, and ideas, and I agree that many need to be tightened up. However, if done right, systems like OKRs can be incredibly effective at clarifying goals, making sure that everyone is transparent and knows what others are doing. I created a specific OKR system not so that I can be the panopticon of the company, but so that everybody--including myself--is held accountable for his or her actions and can understand what is going on.
That, in fact, is one of the greatest advantages of the startup. A gargantuan company like Google could never adapt a completely transparent system. Nobody at the entry level needs to know what Sergei Brin is up to. However, in a company of 5, 10, or 15 people, that level of transparency can build a backbone of education and trust.
We can all melodramatically claim that startups are the best businesses, and that nothing the big companies do is worth our time, but they're large for a reason. They have systems that work. Instead of arguing that you want to "disrupt" them, find a way to do some of the things they do--in every way--and understand what has made them a success. That's the way to greatness.
You'll get better results if you understand and calibrate your assertiveness style. The sixth in a multi-part series on leadership communication.
I recently had a conversation with Eric, a manager at a large manufacturing company in the Midwest. Normally a very peacekeeping, congenial person, he told me how, upon becoming the manager for his group, he had made a point to be forceful to push through his ideas. He was then perplexed when his team did not produce the results he had anticipated.
Sure, it may seem like strong leadership is all about driving ahead and commandeering the situation--that leaders are most successful when they are on the more aggressive and forceful end of what I call the "assertiveness" spectrum. But assertiveness is more complex than that.
In this column, my sixth in a multi-part series on how to best communicate as a leader, I'll cover assertiveness. You can check out my previous columns on how other approaches will help you get through to your team: analytical, structural, social, conceptual, and expressive.
Own Your Assertiveness Style
First, let me describe the two ends of the assertiveness spectrum. Before anything else, you need to understand where you fall. Managers who are on the driving end of the assertiveness spectrum tend to lead by influence; they're task-oriented, decisive, and have a hard-charging approach. Managers who are on the easy going end of the assertiveness spectrum, on the other hand, tend to be more approachable and have a calming presence, take the time to listen, and carefully phrase thoughts and opinions.
That self-awareness is only one factor in calibrating your assertiveness. The other is your way of then understanding your interaction with others. Sometimes your natural assertiveness style will work perfectly, but other times you'll need to flex your character to meet challenges and get the most out of employees.
Here are four tips to assert yourself in the right way, no matter where you personally fall on the spectrum:
1. Know your team.
A group of people who are even-keeled and amiable need you to take time to listen to their ideas and collaborate. On the other hand, employees who tend to drive things forward, need you to show that you're in control; give them directions, set deadlines, and empower them to do the same.
2. Assertive doesn't mean aggressive.
Being task-oriented and decisive, and having high expectations for others, is one thing. Raising your voice and beating your fists on the table will set a different tone altogether.
3. Peacekeepers can be dangerously close to pushovers.
Always communicating and getting things done by being non-confrontational and genial does not equate to continual harmony within your group. It can lessen influence and imperatives.
4. Read the room.
If you are keenly aware of yourself and your team, you can truly flex your assertiveness to your situation. Figure out when a little fiery language will stir the crowd to meet a tough deadline, or when people need even-toned conciliation to get through a stressful time.
Getting back to Eric, the Midwest manufacturing manager. I told him his most effective strategy is to be authentic, and embody his most natural assertiveness style. Then, whether you are driving ideas or bringing consensus to a group, the trick is to know how to fine-tune your approach.
Gabrey Means, the former marketing director at Gap, and Cassie Hughes, the former head of PR at Levi's, were each other's biggest competition--until they founded a company together.
Today, Cassie Hughes and Gabrey Means--or Laverne and Shirley, as they playfully call themselves--are not only business partners, but also best friends. That wasn’t always the case, however. For many years, when Means was experiential marketing director at the Gap and Hughes was presence marketing and publicity director at Levi Strauss & Co., the two were each other’s greatest competition. Each would watch the other's moves, jumping at any opportunity to outdo and one-up her rival.
Neither Hughes nor Means would have ever predicted that they would eventually start a company together. But in 2001 the duo founded Grow Marketing after they both exited the corporate world and were introduced by a mutual friend. Now Hughes is the strategy director and Means is the creative director of Grow. The 12-year-old company sports a client list that includes big names like Pepsi, Dockers, Glenlivet, Got Milk, and their old employers Levi’s and Gap. With 75 employees, the San Francisco-based engagement marketing company has also received numerous awards. Most recently Grow was named to the 2013 Event Marketer “It List” of the industry’s top 100 agencies and was the silver winner of the 2013 Stevie Award for Women in Business for Management Team of the Year.
Hughes and Means spoke with Inc. about the genesis of their partnership and how the two have moved past their former rivalry and used it to their advantage in business.
In San Francisco, Gap and Levi’s are these iconic companies with a rich history and a complicated relationship. What effect did the relationship between the two brands have on the relationship between the two of you?
Gabrey Means: There is just a natural synergy but [also] competitiveness between Gap and Levi’s--and everyone knows it. It just naturally happens because they are both in the same world. We always laugh. Cass was actually my biggest competitor down the road at Levi’s. At the same time this was when the whole world of experiential marketing started blowing up so we were all doing kind of bigger, sexier stunts and happenings. We were trying to outdo each other without really having known each other. But for both of us there was this other woman at the other brand.
Cassie Hughes: The truth of the matter is I don’t think we were actually in the same room together until we actually left Levi’s and the Gap and were introduced by a friend. But we always knew of each other.
So, what was that first meeting like and how did it impact your decision to start a company together?
GM: When we sat down, instead of digging into work, we just really started talking about all of the things that were important to us outside of work--things that have actually really shaped the culture at Grow. From that very first meeting we realized that we had complementary skills but more importantly, we had the same values. I just felt so lucky because from the beginning we knew our cultural guardrails and what we were marching toward. We had a shared vision from the start with that first meeting.
CH: Exactly. Life is too short to do anything you aren’t passionate about. Gabrey and I have made a really conscious choice to stay an independent agency so that we can make choices on not only the brands and companies we support, but the type of people that we work with. I think that’s what keeps us excited every day when we walk into work.
In what ways do you think your past as rivals has impacted your business?
GM: I always knew what Cass was doing down the road when I was at Gap and now whenever we are building a pitch or building a program for a current client, it is part of our culture to always look at best-in-class examples that we can learn from. We are always keeping an eye on what is happening and trying to be in the know. I think that was part of our competitive spirit when we used to keep tabs on each other and it has kind of permeated into Grow.
I have never really thought about it until now, but that competitive spirit was something that attracted us to each other and that was a dynamic in our relationship even when we didn’t know each other. That is an energy force. We just evolved it and turned it into this amazing creative, strategic energy.
CH: And you know what, we are in the agency world of marketing. There is so much competition out there. We have each other’s backs and there isn’t anyone else I would rather have watching mine.
Has it ever been difficult to keep your past in the past?
GM: From the minute we said we were doing this together, we put all that competitiveness aside. What we found in each other was what made each other great when we were at our careers at Levi’s and Gap. We basically took what fueled our competition and we used it to fuel Grow. We have always thought that with us one plus one equals three.
CH: Yes, in that moment it went from competition to inspiration. I think to be true business partners you can’t have that same competition with one another. You can’t be successful with that. There has to be a ‘we’ or it’s not going to work. It has always felt really easy. I don’t think we have ever, ever had a power struggle.
In what other ways have your previous careers with Gap and Levi’s impacted Grow?
GM: When we were with Gap and Levi’s we were the ones hiring marketing agencies from around the country. I think we basically started Grow as an outpost of not being able to find an agency who could deliver to the level that we wanted. From the beginning as a result of having served those roles at Gap and Levi’s we said that we wanted Grow to be all things to our clients.
CH: When we started the company we didn’t want to have politics. We didn’t want to have a lot of layers. Here everyone’s biggest competitor is really himself or herself. No one is pointing fingers. Everyone is on his or her own trajectory and we purposely made it that way.
Why you should stop simply aggregating your customers' feedback into a score or percentage.
Your customers’ satisfaction is important to you. That’s why you take the time to analyze their comments and create a number of some sort that you can monitor. That sounds like simple and sound business logic, but according to Rob Marke, co-author of The Ultimate Question 2.0: How Net Promoter Companies Thrive in a Customer-Driven World, if you’re just aggregating customers’ feedback you may be doing them a disservice.
In a recent HBR Blog Network posts he lays out five sins of dealing with customer feedback. Prominent among them is an approach that could be called aggregate and dump. Boiling feedback down to numbers and then ignoring your clients’ specific comments is generally wasteful, he argues:
This common mistake completely obscures any individual customer’s voice and prevents employees from linking the feedback to a particular event, behavior, or action they can remember. Yet there’s something irresistibly seductive about numbers that seem so rigorously mathematical. “Congratulations! Customer satisfaction increased 0.431% this quarter! Great job!” Of course, most companies try to figure out what drove the improvements by breaking down each summary score into dozens of “drivers,” but the typical result is that employees get lost in a sea of analysis and numbers.
Coming up with a number sounds clean and scientific but relying entirely on such a score and disregarding words entirely, means you lose the human voices behind the statistics, which have huge value, Marke insists. That’s why he also recommends customer surveys not be ade up exclusively of multiple choice questions, and instead offer customers the “chance to share their feedback in their own words."
But missing out on actionable areas for improvement or specific opportunities to delight your customers isn’t the only reason Marke is an enemy of excessive aggregation. It also generally takes awhile to boil all that feedback down into metrics, he points out, and when it comes to learning from customer complaints, speed is key.
Because it’s time-consuming to aggregate feedback, "many companies distribute summaries of what they hear from customers six, eight, or even 12 weeks later… How well do you remember each of the many conversations and interactions you had six weeks ago?" he asks. "Chances are your employees don’t either -; which makes it awfully tough for them to remember what they did that might have contributed to variations in their customers’ feedback."
Curious what else you might be doing wrong when it comes to dealing with client feedback? Check out the complete post for Marke’s complete list of common errors.
Are you guilty of aggregate and dump?
T'is the season to be a little morbid. But if you identify what could be your demise now, you'll set yourself up for a much stronger 2014.
It's disconcerting for entrepreneurs to realize how vulnerable their fledgling businesses are, no matter how great the idea seems or the degree of traction they get in the marketplace. That's essentially what Aaron Schwartz, founder and CEO at Modify Industries, which runs the site Modify Watches, realized and wrote about recently in VentureBeat.
His now three-year-old company makes watches with interchangeable parts and has some 25,000 Facebook fans--but Modify has only six months to live. Without a significant change, even after a first round of funding, the company will be bankrupt in half a year. A very scary thought.The Problem
Although some businesses can generate sufficient profits early on to stay relatively safe, many face what is in front of Schwartz: the need to drive up revenue and drive down costs quickly enough to become cash positive before on-hand reserves run out. And, frankly, if that isn't a problem, there are likely others--aggressive moves by a large competitor to stamp you out through legal maneuvers, a sudden disastrous change in a supply chain, the resignation of some critical personnel, or more--that could derail your efforts.
Luckily for Schwartz, a couple of seemingly minor events rubbed his nose into what should be (but seldom is) obvious to entrepreneurs: the sooner you identify a problem, the better a chance you have to avoid its consequences. Here's how he relates the second event, which involved reading about a story of the early days at Intel:
The next week I was reading "Decisive" by Dan and Chip Heath. The authors recount a story about Andy Grove and Gordon Moore at Intel. The two leaders were trying to figure out if Intel should continue focusing on its large legacy business, memory, or instead focus on the small-yet-growing microprocessor business. One day Grove, the president, asked Moore, the chairman and CEO, "If we got kicked out and the board brought in a new CEO, what do you think he would do?" Grove replied that they would get out of memory immediately. As the Heath brothers put it, this was Grove's and Moore's "moment of clarity."
I don't think he actually meant that Grove answered himself, but that is an unimportant error. The critical point to is recognize the dangers that face a company and the actions an experienced executive fresh to the situation and not burdened with past decisions might make.Knowing What Can Kill You Makes You Stronger
Like Schwartz, now is the time for you to write the pre-mortem of your business. He found some issues that faced his company. The important thing for you is to identify the ones that could scuttle yours.
There is rarely only one danger you face, and yet not all are equal. You want to pick out the top ones. Look for three as a number you can comprehend and easily follow. Take those three dangers and apply an old acting exercise that Constantin Stanislavski called "What If?" Instead of forcing yourself into a different way of thinking, ask what if you were the new head of the company, presented with these three problems, and asked how to ameliorate them.
You're allowed to check with other entrepreneurs, experts, consultants, books, websites, or any other resource you choose. The important thing is to solve these three big problems. Once you have a strategy in place and are making headway, you can consider the next three big problems you must overcome.
By doing so, you take action ahead of when a crisis might occur and strengthen the appropriate parts of your strategy and operations. Do this and the chances of your company ultimately succeeding and thriving go up enormously.
How to apply innovations at companies like Starbucks and Amazon to your business
Most small business owners intuitively understand the power of loyalty. They instinctively seek to turn new customers into regulars and regulars into word-of-mouth advocates.
Besides improving product and service quality, the most common loyalty tactic among small business owners are simple rewards programs. And they work. But are there other loyalty tactics owners should consider?
Sure, it’s great for your business when customers pay ahead of time, but what about prepayment as a loyalty strategy? If structured correctly, prepayment can drive huge increases in customer spend--customers, after being incented to prepay, significantly increase spend because their prepayment acts as an ever-present motivation to get the most out of their investment.
One of the most famous examples of how prepayment drives out-sized gains in loyalty is Amazon Prime. Amazon customers essentially prepay for their shipping fees for the year when they sign up for membership at $79 per year, but analysts estimate that Amazon Prime customers spend on average 150 percent more after they join, which more than pays for that free shipping.
Another famous example is the Starbucks loyalty program. Customers can prepay to earn rewards like a free drink on their birthday or free refills. By putting rewards and prepayment on the same card, Starbucks has essentially combined two loyalty tactics (rewards and prepayment) into one. One study I read estimates that Starbucks customers who prepay spend 162 percent more than the average Starbucks consumer!
It’s not just for big business. I have three suggestions on how you might try to do this:
1. Membership Fees
This would be like implementing your own version of Amazon Prime. If free shipping is not relevant for your business, consider other benefits like a permanent discount on drinks or on the total bill or even a special VIP-access that allows members to always get a reservation. While it may seem counter-intuitive to offer discounts and benefit, you need to trust that the increase in visit frequency will more than pay for the discount. Basically a membership fee locks your regulars in even more and provides an additional incentive to make your business their first choice.
2. Cash Bonus for Prepayment
You could also experiment with turning gift cards around and making them not just gift cards for the friends of your customers but prepaid cards for your current customers. In return for a cash bonus like 10 percent or a free gift on every load, you'll most likely see that customers that prepay will come back even more frequently and spend more when they do. When we rolled this scheme out to the merchants that work with my own company, we saw existing loyal customers increase their monthly spend by 50 percent after prepaying to get a 10 percent cash bonus on a re-loadable card.
3. Monthly Subscription
This is a tactic that's increasingly being used in retail. Amazon has its own version called Subscribe & Save. Basically you are turning your regular customers into subscribers who commit to buying on a regular basis in return for an ongoing discount. This again is playing with the idea that a pre-commitment will drive outsized gains in lifetime purchases, which far outweigh the discount offered.
While the above strategies may seem counter-intuitive, they are proven by some of the most innovative companies in retail. Try to experiment with these ideas to get some crazy increases in loyalty at your own business in 2014.
Your team in a room with a whiteboard? As it turns out, that tried-and-true brainstorming method produces the lowest-quality ideas and wastes the most time. Here's a better way.
In 1942, BBDO ad executive Alex Osborn (the real Don Draper), coined the term "brainstorming" and published these four rules of engagement:
1. Focus on quantity. The more ideas you produce, the greater your chances of hitting on something radical are.
2. Withhold criticism. There are no bad ideas in a brainstorm.
3. Welcome unusual ideas. Suspend your assumptions on the road to solutions.
4. Combine and improve ideas. In other words, 1 + 1 = 3.
So adamant and convincing was Osborn (he was an ad man, after all) that these brainstorming laws remain largely unchanged 70 years later. There's just one problem: Osborn was wrong.
As Keith Sawyer, associate professor at Washington University, explains in the New Yorker, "Decades of research have consistently shown that brainstorming groups think of far fewer ideas than the same number of people who work alone and later pool their ideas." In other words, brainstorming is an inferior strategy for idea generation.
Paul B. Paulus, psychologist at the University of Texas at Arlington, adds more damning evidence. For 15 years, he has studied the quality and quantity of ideas produced in group brainstorming sessions versus those that emerge from solitary or paired thinking. The unequivocal results? The most revolutionary solutions spring from group discussion of ideas hatched in isolation.
When it comes to typical brainstorming sessions, Paulus tells the school's magazine, "There's plenty of rain in the storm. That is, plenty of ideas falling from the sky. But there's not much lightning--the exceptional ideas that have the potential to set things on fire."
Investor Marc Andreessen recently spoke at the Lean Startup Conference and described how new founders can hold onto their best employees.
There is one recurring, and unacknowledged, reason that potentially great employees leave a startup.
It's because they can't articulate to outsiders what they're job actually is, according to Marc Andreessen, general partner at venture capital firm Andreessen Horowitz.
"It's actually a really funny thing. People quit because they get just embarrassed," Andreessen said Tuesday, speaking to a packed house of hundreds at the Lean Startup Conference in San Francisco. "If they can't explain to their spouse, if they can't explain to their kids, if they can't explain to their neighbors what they're doing -- that's a big issue for a lot of people."
So how can CEOs avoid losing their top talent to abject embarrassment? They can be as thorough when describing their business plans to employees as they are when describing them to VCs, Andreessen said.Drill Down: Be Specific
"Actually explain to people at your company: here is what we are doing. Here is that plan, and here is how we conceived the plan. Here are the things that we know. Here are the things we don’t know," he said. "Then every week, every month, every quarter, update: we have learned the following," He added that the CEOs that do this well are remarkably good at retaining employees, even during tough times.How to Describe Your Plan
This is opposed to describing your business plan in terms of top down market sizing, which is a huge turnoff to both employees and investors, Andreessen said. For example:
"They literally come in and they'll be like, 'We have this new thing we're going to build, some new wearable gadget. The wearable computing market is going to be $35 billion in three years … All we need to do is get three percent of that,'" Andreessen said, describing a common pitch format.
Instead, he recommended creating a projection timeline that includes solid estimates of how many customers the company will have down the road, as well as how much they will pay for the product. The actual results will more than likely prove to be different, but thinking about growth in these terms will demonstrate to whoever is listening that you deeply understand your market.
"And by the way, if you can do this with your employees, then investors are a slam dunk," Andreessen said.
Three leadership tips to take from Auburn's win over Alabama.
I was born and raised in the South where college football is a religion. I had no SEC affiliation, so when I got married, my wife's family seized on the fact that I had no true allegiance and I became an "Auburn fan by marriage."
Each year, the Auburn and Alabama teams meet up in what is called the Iron Bowl. While this game is always a big deal, last week's Iron Bowl was exceptionally important because the winner would move on to the SEC Championship game.
At the end of the fourth quarter, the teams were tied at 28. Nick Saban, Alabama's legendary coach, insisted that one second be added back to clock, adding one last play in regulation. The decision cost his team the game. In that final play, Alabama attempted a field goal that was blocked and returned by Auburn--a 109-yard touchdown that won Auburn the game.
Football, they say, is life. Whether or not you agree, there are many lessons you can learn as a business leader from Coach Saban's decision.
The Timeline Isn't Always the Most Important Thing
Saban's demand that one second be added back to the clock is like the executive who insists a product be shipped on time even if it's not ready. The damage a bad product launch can have on your company's reputation can be hard to recover from.
The wiser choice on Saban's part would have been to allow the time to run out and move into overtime. This extra time would have potentially given his team the runway they needed to be victorious.
While it's important to establish hard timelines for your project and initiatives, don't lose your focus. You should always strive to achieve the best result even if it takes a little more time.
Don't Send in an Amateur to do a Professional's Job
One of Alabama's weaknesses throughout the game was their inability to successfully kick a field goal. The final field goal attempt was more than 50 yards, and Saban chose an inexperienced freshman kicker. Instead, he could have attempted a Hail Mary by playing AJ McCarron--who has helped to lead Alabama to dominance over the past three years with his Heisman-caliber throwing arm.
Who knows if this choice would have turned out any differently, but when the stakes are high, it's always better to rely on a resource that is experienced and a known. This may require spending extra money to hire expertise or pulling your best resources from other initiatives. If this is not an option, then considering a different approach altogether might be the better option.
Anticipate Your Competition's Next Move
In Malcolm Gladwell's recent book David and Goliath, he explains that the underdog often wins because they employ unconventional methods. Saban didn't anticipate that Auburn would place someone in the end zone to catch the ball. The Alabama players were caught off guard as Auburn's Chris Davis jetted past them to score an instantly legendary touchdown that has been referred to as the "Immaculate Reception."
As a company leader, you need to play the field from both sides. Consider not just what or who your competition is today, you must also look to what they might do in the future. If you are selling your product based on a technology advantage, will that technology be obsolete in a few years? What else should your company provide to stay competitive?
These questions are easy to answer: Just talk to your customers, they will be glad to tell you.
CareerBliss released its annual awards based on rankings of employees themselves.
To run a great company, happy employees are often a prerequisite. Curious how to bring joy to workers' lives? Take a cue from the happiest companies.
CareerBliss, a company aimed at empowering job seekers to choose satisfying positions, released its annual awards this week of the 50 happiest companies in America. The winners were chosen by thousands of employees who submitted reviews ranking their happiness based on culture, compensation and personalities at each company.
Here's how the following five companies managed to take the top honors:
No. 5: Qualcomm
Qualcomm, a communications company based in San Diego, that markets and manufactures wireless communications products, has an average salary of $87,000, with 50 percent of the company making about $156,000.
What employees said: Qualcomm provides an encouraging environment.
No. 4: EMC
EMC, a consulting and IT services company based in Hopkinton, Mass., has an average salary of $89,000, with 50 percent of the company making about $134,000.
What employees said: The company offers great benefits and the pay allows employees a great deal of freedom to do their jobs.
No. 3: Texas Instruments
Texas Instruments, a technology company based in Dallas and well known for its calculators, has an average annual salary of $81,000, with 50 percent of employees making about $108,000.
What employees said: Employees praised the company for its fairness and focus on training.
No. 2 Kaiser Permanente
The Oakland, Calif.-based managed health-care provider Kaiser Permanente, has an average salary of $76,000, with 50 percent of the company making about $106,000.
What employees said: The work at Kaiser Permanenteis interesting and employees are knowledgeable and kind.
No 1: Pfizer
Pfizer, a global pharmaceutical company based in New York City, has an average salary of $83,000 with 50 percent of employees making about $123,000.
What employees said: Pfizer takes the grand prize for its quality-training programs and top-notch benefits.
What you can learn from Jimmy Iovine and Trent Reznor's new streaming music service.
Beats Music doesn’t begin until January, but it's already being touted as the next big thing in music streaming. The star power of famed record producer Jimmy Iovine and Nine Inch Nails frontman Trent Reznor, who developed the project with headphone maker Beats Electronics, has certainly helped. But its biggest sell will be how it fills a perceived gap in the market.
On the surface, there doesn't appear to be a gap at all: Spotify has long been a fixture in the U.S., as have Pandora, Songza, Grooveshark, and Rdio, which recently suffered layoffs despite its growing number of users. Even French startup Deezer, which is available in 80 countries worldwide, plans to expand to the U.S. next year. Then there's Apple's iTunes Radio, which may be the best-positioned of all of them.
Revenge of the DJs
Although none of the startups in the streaming-music space is profitable, despite boasting millions of paying subscribers, they seem to offer consumers more than enough to get their music fix. Most are available on mobile and offer a reasonable selection for non-picky fans.
But from Beats's perspective, that isn't enough. There is no human curatorial element (read: DJs), much less any reliable means for broadening users’ tastes. Other services have experimented with radio and discovery features, but without human guidance, listeners have trouble connecting with an artist or finding new ones worth exploring. Some users feel bombarded by the array of artists to choose from--Spotify's catalog includes more than 20 million songs, while Pandora's numbers around 900,000--and others are frustrated by algorithmic curation that makes errors like mislabeling a band's genre.
Beats, which raised $60 million in funding earlier this year, promises global scale and intelligent curation, meaning artists will create playlists and offer suggestions.
"As great as it is to have all this information bombarding you, there’s a real value in trusted filters," Reznor, who serves as Beats Music's chief creative officer, told The New Yorker last year. Beats Music "is like having your own guy when you go into the record store, who knows what you like but can also point you down some paths you wouldn’t necessarily have encountered."
Real people recommending songs will help set Beats apart, says Quentin Fleming, an adjunct professor at the University of Southern California’s Marshall School of Business. And Beats Electronics’ reputation will put the service on customers' radar, especially if the company finds a way to integrate its hardware with the streaming service. Beats Electronics is on track to make $1.4 billion in revenue this year, reports Fast Company's Austin Carr, and leads the $100-plus headphone market in the U.S. with a more than 60 percent share.
Business owners can learn from Beats, although it seems counterintuitive for such a successful company to move into the streaming music business--a place where no one has profited. "I wonder if they see the market maturing enough to where it might make sense," Fleming says. "Beats is such a high-quality sound system, they might be targeting people who don’t just want to hear something but the full depth and range of the music."
Jeffrey Carr, clinical professor of marketing and entrepreneurship at New York University's Stern School of Business, views Beats's strategy differently. The company is following in several businesses' footsteps, he says, assessing what it's currently selling and what customers are buying in addition to its products. "If you sell headphones and they’re being used to stream music, then to them it looks like a small step," he says.
Both professors say Beats probably commissioned market research to see what customers felt was lacking and how they could improve those issues. “If Beats Music becomes a success,” says Fleming, “then it will be because they somehow found a way to address these things in their offering. Even though all these companies are in the streaming music business, there may be no one in the space where they’re trying to play.”
However, Carr argues it really doesn’t matter whether the market is mature or full of competitors, as competitors are a fact of every business (and a good one at that). “If you look at Amazon, it’s a bookstore," he says. "It’s not like that market needed another seller. The difference is whether you have something to bring to the competition that is different and valuable to the customer.”
Need to boost your network? Here's how to do it.
Over the past twenty years, social entrepreneurs have shown that we can successfully use market-driven approaches to solve social and environmental complex problems. Ben and Jerry's and Patagonia may have been the pioneers, but others such as Whole Foods, Seventh Generation and Stonyfield Farms continue to show that aligning authentic purpose with profits can breed high customer loyalty and low employee turnover.
That doesn't mean it's easy. Here are five tips that can make it easier to launch and grow a for-profit mission-driven venture:
1. Research The Ecosystem
Just as for-profit enterprises need to do a competitive analysis, you need to do plenty of research on your field another others who are tackling the same problems you are. Are there social enterprises out there that can help you learn best practices you can use to launch or grow your own? Could you partner or get hired to build a new arm of a social enterprise instead of founding your own? Networks such as the Impact Hub, Ashoka, Echoing Green, the Skoll World Forum, the Unreasonable Institute, and the Ayllu Map of Social Enterprises can save you a lot of time and energy when it comes to identifying like-minded social enterprises, potential partners, and impact investors.
2. Consider Joining the Social Venture Network
Founded in 1987, SVN is the premier professional association for values-driven business leaders, social entrepreneurs, and impact investors. SVN offers a number of tools and resources, an impact blog, and a Peer Circles program designed to launch and grow triple bottom line business. The SVN Hall of Fame has recognized triple bottom line entrepreneurs such as Eileen Fisher (Eileen Fisher), Margot Fraser (Birkenstock), and Kit Crawford (Clif Bar).
3. Get free feedback on your business plan from the William James Foundation (WJF)
The WJF Business Plan Competition is only open to for-profit entrepreneurs that want to make a positive social and/or environmental impact. Each business plan submitted receives extensive feedback (on average 14 pages) from experienced entrepreneurs on financing, operations, distributions, and potential partnerships.
The competition culminates with the WJF Annual Gathering in Washington, D.C., which is a unique opportunity to meet social entrepreneurs, mentors, and impact investors from around the world. WJF entrepreneurs have gone on to receive seed and growth capital through prestigious impact-driven incubators such as the Unreasonable Institute and Echoing Green.
4. Investigate benefit corporations
Companies such as Patagonia, Seventh Generation, and Ben and Jerry’s are among the 850 certified benefit borporations operating in 29 countries across 60 industries. Benefit corporations adhere to annual audits that ensure transparency in their operations and hiring practices. In addition, 19 states have passed legislation that includes tax breaks for so-called B Corps.
The annual B Corp Champions Retreat brings together Benefit Corporations leaders to share best practices and resources.
5. Explore hybrid structures such as L3Cs
The Low-Profit Limited Liability Company (or L3C) is a blended structure between LLCs and 501c3s. A tally by InterSector Partners shows that more than 930 L3Cs have been formed in the U.S. since 2010. Marc Lane’s blog remains one of the best resources to better understand the pros and cons of forming an L3C. Emerging L3C entrepreneurs include Caryn Capriccioso, co-founder of InterSector Partners, which helps entrepreneurs launch and grow social enterprises; Dena Patrick, founder of Wishadoo!, a network that crowdsources compassion; and Kathleen Norton-Schock, whose Ardent Cause provides IT products and virtual CIO services to enable nonprofits to measure and amplify their impact.
There are more opportunities to do well and do good today than ever before. Use this list to gain access to some of the networks, resources, and tools you need to determine which social enterprise model is the best fit for you.
The short of it is, Twitter is offering a better way to follow and target your customers. Here's how it works.
Twitter recently launched a new ad retargeting product called Tailored Audiences. The gist of it: Now, you can tag users who have visited your website, and hit them with your ads while they're browsing Twitter.
To understand what this really means for your business, let's back up and look at how Twitter ads have typically performed, how retargeting actually works, why social retargeting is different, and how you can tap into the power of retargeting.Do Twitter Ads Work?
Previously, they were pretty awful.
I recently analyzed Facebook vs. Twitter ad performance, comparing the two across a number of key factors including network reach, ad performance on desktop or mobile, and average cost.
- Click through rates with Twitter Ads can be ten times higher than Facebook ads because Promoted Tweets appear prominently in the Twitter stream--they have an inherent edge over Facebook Ads, most of which appear in the right sidebar.
- However, Facebook ads crush Twitter ads in terms of their ability to drive sales and leads. For example, revenue per visitor was more than two times higher for Facebook ads compared to Twitter ads.
Bottom line, if your ads aren't driving revenue, what good are they?
But all bets are off now that Twitter has released new Twitter Tailored Audiences, The company is claiming that it has seen some pretty spectacular results in early retargeting testing, including:
- A 45 percent lift in engagement for a B2B advertiser.
- 74 percent lower cost per acquisition (CPA) for a technology company.
- 195 percent higher conversion rates for an enterprise-level app performance management brand (which proves how badly the previous Twitter ads worked).
Tailored Audiences offer a great opportunity to increase ad performance because you can drive more targeted ad creative to reach specific segments of users... but can it really be that good?How Retargeting Works
Retargeting is an ad tactic that involves tagging your website visitors with a cookie, then targeting them with banner ads after they left your site and continue surfing on the Web. It's an important tactic, especially considering that 96 percent of website visitors leave without converting to a sale or lead.
Using an ad network such as the Google Display Network, you could then target those same website visitors who had just visited your site, and show them your ads while they're they're watching a YouTube video, or checking their email, or reading the news, etc.
The key here is that these retargeted ads always outperform generic banner ads because they're relevant to a user recent browsing history--people are far more likely to buy something when they've already looked around for it.
Retargeting can help with:
- Turning people who abandoned or bounced from your site into leads and sales.
- Increasing brand recall and branded searches for your company.
- Encouraging repeat site visits and engagement.
Americans spend over three hours a day on social networking sites. Add to that the fact that 65 percent of the time spent on social networks happens on mobile devices, and you can see why advertising networks have tried so hard to tap into this audience.
There was a problem, though: people aren't interested in buying products or services when they're looking at pictures of cats on social media. Previously Twitter ad targeting was pretty broad, limited by user demographics like gender, age, location, and who they're following.
And that was Twitter's challenge. It needed to get more granular and specific, for advertisers to truly let brands connect with consumers with the right message, at the right time.How Twitter's Tailored Audiences Works
Tailored Audiences is a tool worth trying out. Twitter is working with a number of ad network partners, who hold the keys to the user tracking data needed to make retargeting work. Now, you can use Promoted Tweets and Promoted Accounts to target people who visit your site, search for information about your brand, purchase from your company, click on a tweet, and more.
Here's how to get started:
Here are a few tips to help you get a better return on your social retargeting ad campaigns:
- Optimize for mobile: The majority of Twitter users are on mobile devices. Tailor your ads for mobile users--if your ads point users to your website, it had better be optimized for a fantastic mobile experience.
- Don't overdo it: Use ad frequency capping to limit the number of times your ads are shown to a user.
- Be engaging: Use questions, appropriate humor, captivating images in your ads. Never forget that it's still a social network. Promptly respond to any questions or comments about your ad.
Twitter's Targeted Audiences can be a great tool for marketers looking to reconnect with potential leads and existing customers--if you know how to use it.
Your back, hips, and shoulders will all benefit from this easy office exercise.
If you spend most of your day at the desk, you know the feeling. Your back is tight, your hips are stressed, and at the end of a long day stuck in the virtual world, just getting up and walking feels borderline unnatural.
The simple exercise below, called the thoracic bridge, was recently posted on lifehacker.
Don't mistake it for a full workout; you should still schedule a run or some time at the gym. But it will loosen your hips and shoulders. It's a quick and effective way to relieve some of the stress that comes with spending hours and hours lurched over your keyboard. I can vouch, having practiced it daily since seeing it since seeing it last week.
It will take you two and a half minutes to learn, and less time to put into practice.
Stiff joints and muscles aren't the only perils of office work. Among the horrifying findings: men who spend 23 hours per week in a sedentary position are at 64 percent greater risk of dying of heart disease than those who report 11 or less sedentary hours.
Aside from the exercise highlighted above, consider scheduling and encouraging walking meetings, as well as frequent breaks. Allowing your employees to get up and walk around every fifteen minutes or so can go a long way.