BRIAN WEBB BLOG

Checkout these excerpts from Ricardo Semler’s lecture at MIT. You can catch more of this on the 37 Signals blog. TIME Magazine featured Ricardo Semler among its Global 100 young leaders profile series published in 1994 while the World Economic Forum also nominated him. The Wall Street Journal America Economia, the Wall Street Journal’s Latin American magazine, named him Latin American “Businessman of the Year” in 1990 and he was named Brazilian “Businessman of the Year” in 1990 and 1992.

MOST BUSINESS PLANS ARE WISHFUL THINKING
A 5 year plan is just an extrapolation added to wishful thinking. Have you ever seen a business plan that says, “I’m going to go up 5% and then down -14% and then -22% and then I’m going to recuperate a little bit and then it’s going to go to hell?” ‘Cuz that’s what happens. That’s how it looks in practice, but that’s not the way we design it. We’re willing to trick ourselves into thinking we have control as long as we do it with wishful thinking.

COMPANY GROWTH IS OVERRATED
The assumption that growth is good for companies is a very difficult one to sustain. There is no evidence whatsoever that companies that grow a lot do better than companies that don’t grow a lot.

ADMIT WHAT YOU DON’T KNOW
We don’t know where we’re going, but we’d rather not pretend that we do. Because we think pretending is a lot more dangerous than admitting that we don’t…Talking about specific numbers more than six months out is improbable. Think about the future but don’t write it down. If you write it down, you have to follow it.

MAKE MEETINGS VOLUNTARY
All our meetings are on a voluntary basis. Because if it’s getting boring, go…If no one’s left, do we really need to do this?

MOST HIRING IS LIKE INTERNET DATING
On hiring, the typical process of recruitment and selection in a company is basically an internet dating process. You say your company is Brad Pitt and she says she’s Angelina Jolie and you go and meet at a bar…You get together for two quick meetings and then you decide to get married and hope it work. Instead, we take qualified candidates, the ten that fit the bill, and ask them to come in together. Then we have whoever wants to be involved interview these people. This will go for hours. Then “the interviewers” write down the two people who they want to keep. The two who score highest come back and spend the whole day here and talk to anyone they want…The result is less than 2% year turnover.

DO NOTHING SOMETIMES
Sometimes doing absolutely nothing, even about a critical decision, will end up bringing you through a solution. The idea that we alone can be trained to “know the answer” is a very dangerous rational.

WE NEED MORE DEMOCRATIC WORKPLACES
We will send our sons anywhere in the world to die for democracy…but I’ve never seen a democratic workplace. So it’s very important for our lives except where we spend 60% of our time. There must be something wrong with that.

TACO BELL HITS A HOMERUN
Advertising Buy… $5.6 million, Potential Giveaway Cost: Under $1 million, Publicity Value…Priceless. That could well be the marketing brief at Taco Bell, which scored a PR home run with the promise of a free taco to any American who wants one if a base was stolen in the World Series. Luckily for those hungry masses, Red Sox rookie
Jacoby Ellsbury stole second base in the bottom of the fourth inning in the series’ second game. Taco Bell’s promotion gave every American a free taco.

According to Nielsen Monitor-Plus, Taco Bell is one of the top 10 advertisers in the series, spending $5.6 million (General Motors Corp. is the heaviest hitter, at $13.2 million).

It’s expected that figure includes all the extra airtime Taco Bell got on the broadcast — plugs from TV anchors and sports figures about the promotion and a live interview with Rob Savage, COO of Taco Bell — not to mention a mention of the promo from a player in a “candid” conversation between Sox shortstop Royce Clayton and Mr. Ellsbury the evening before the big steal.

“It’s definitely driving the conversation,” said Pete Blackshaw, CMO of Nielsen BuzzMetrics. It’s hard to argue with good buzz.

SECONDARY EXPLOSIONS
One measurement of success by our military when bombing our enemies, is the discovery of secondary explosions. Secondary explosions indicate that the bomb landed on stored vehicles/aircrafts, fuel dumps or ammunition depots… indicating maximum effectiveness for the risks and costs incurred.

Who’s talking about your product or service? While nobody’s likely to lead that effort more aggressively than you… it’s important for you to develop smart strategies that engage and encourage “others” to talk about you. Taco Bell successfully landed some secondary explosions with their advertising.

Aim your marketing, PR and advertising efforts at targets that will deliver “secondary explosions,” delivering your business maximum returns for your investment.

Brands are decision making shortcuts in a fast paced world. People will frequently choose a well-branded product or service that’s inferior and more expensive, over a non-branded product or service, that’s superior and 30% cheaper.

Think about it. Prospects trust brands. A brand is a promise… a promise that you’ll do what say you will do. Offer your clients a shortcut. Build and strengthen your brand.

For years… physicists have discussed an important phenomon… the “gravitationally completely collapsed object.” Then, a creative physicist, devised a better name for it… he called it… a “Black Hole.” Suddenly the world was interested.

Your words matter. One word or metaphor can quickly define your concept and uniqueness, and make your concept compelling.

If you are selling something complex, simplify it with a metaphor.

This post is directed to all of you entrepreneurial business owners out there. Do you “EVER” want to take weekends off… leave the office at 5pm… coach your son’s little league team… or leave for vacation without stressing over what will crash and burn in your absence?

Well, it’s all about systems. You will be enslaved to your business forever unless you choose to systematize your business. “A little hard work and some common sense is enough to get me where I want to go.” That’s a myth.

I’ve posted about it before… but I vehemently and emphatically implore you… I insist… I beg you to read 2 books that are critical to your business and personal freedom… by Michael Gerber… E-Myth Revisited and E-Myth Mastery. If you’re not a reader… then checkout the E-Myth Revisited and E-Myth Mastery audio books from iTunes. Study these resources with a microscope… examine them… implement them… master them! They are the cure for most forms of your business cancer.

Click Here to watch a newly posted video that highlights some business leaders that have experienced EMyth success.

THE FOLLOWING ARTICLE IS FROM MICHAEL GERBER’S MONTHLY
E-NEWSLETTER, THE E-MYTH INSIDER:
Documenting the processes that control business operations is where the rubber meets the road in systematizing a company. System documentation requires a business owner to analyze and define all regular business processes. In E-Myth terminology, standard operating procedures are documented using “Action Plans.”

An “Action Plan” is a form that defines the desired result, required materials, sequential steps, quality standards, due dates and staff responsibilities for individual business processes.

Once processes are formalized, the “Action Plans” become key elements in the “Operations Manual” of your business. Producing your “Operations Manual” will help your business run more efficiently, and should allow you to step back from the day-to-day tactics to do real strategic planning.

WHY CREATE ACTION PLANS?

1. Action Plans can be used as templates for defining systems
2. Action Plans capture input from those involved in the process
3. Action Plans become lessons for staff training
4. Action Plans become the contents of your business’ Operations Manual

Click Here to see an “Action Plan” sample for “making coffee.”

Okay, I am not suggesting that quality isn’t important… but if you’re to compete in the marketplace of tomorrow, prioritize speed over quality. We’re living in a world where my family and I can pull up to a drive-thru window, and be driving away with a hearty full-course dinner for 5 in under 2 minutes.

I can walk into my bank tomorrow morning, and close on a $250,000 business loan before lunch.

I can order a $10,000 MacPro computer, an $1,800 30″ Cinema display, and a $650 HP printer on Monday afternoon… and have a pile of boxes sitting on my doorstep by the following morning.

Shooting for “fast” simply isn’t good enough anymore. We’re living in a culture that more and more offers us instant gratification. People expect more, and expect it faster. The delivery of services is headed towards “real time.”

Shoot for speed over quality. Refine your business to cut your service delivery times in half… then in half again… then in half again.

Clearly, planning is crucial to your organization… but not so much because of what the plan itself yields, but rather because of what the “process” of planning yields. Plans themselves often prove to be ineffective, simply because things change… The economy changes, the market changes, we change, culture changes, and our focus changes. But the “process” of planning keeps us sharp, always evaluating, collaborating and pursuant of creative new approaches to our business or organization.

Conventional “Walt Disney” wisdom of decades past, led many to conclude that you must have a 5, 10, 15, 20 and perhaps a 25 year plan… and that you leave little to chance. That “crystal ball” mindset in today’s culture and economy is simply obsolete. It’s impossible to consistently predict with accuracy what tomorrow holds.

Best selling author, renowned communicator, and senior pastor of a leading church in Alpharetta, Georgia; Andy Stanley, was questioned at a conference about his long-term plans. Andy compared the limitations of planning… with the headlights of his car while driving at night. “The headlights of my car shine and reveal a certain and finite distance ahead of me… I can only see so far. But I can see farther and farther ahead as my car advances forward, one linear foot at a time.”

Paraphrased… Every new day reveals a little more about the need for new business strategies and tactics. Plan for the short-term. Dream for the long-term.

STUMBLING AROUND IS HEALTHY TOO
On the other hand, while it’s healthy to plan, stumbling around a bit is just as healthy in balanced proportions. Sergey Brin; Co-Founder of Google, once stated, “The more you stumble around, the more you’re likely to stumble upon something valuable.”

Did you know that Google requires their senior engineers to spend 20% of their salaried work-week to pursue their own personal projects. These personal projects have nothing to do with their professional responsibilities at Google. They just invent.

The process of planning is crucial, but allot time for your executive, professional and administrative teams to stumble… to grow, to develop, to invent, to make mistakes, to fail forward. This balance promotes growth, and a happier and more fulfilled team… and ultimately a stronger business/organization.

Co-founding duo of Google; Larry Page and Sergey Brin, cruised onto the stage of an academically elite high school auditorium in Israel to speak to the student body. They were met with the kind of roars and excitement that teenagers usually reserve for rock stars. Larry and Sergey entered the auditorium through a rear door… leaving behind photographers, sunglasses, a pair of hired cars with drivers, and an attractive young woman that was travelling with Sergey.

Dressed casually and pleased at their welcome, they sat down and cracked smiles. They were to speak about what they had done, how they had done it, and what their dreams were for the future. “Do you guys know the story of Google… Do you want me to tell it?” Larry asked. “Yes,” the crowd shouted.

It all began while Sergey and I were Ph.D students, studying Computer Science at Stanford University. We didn’t know exactly what we wanted to do.

I got this crazy idea that I was going to download the entire web onto my computer. I told my advisor that it would only take about a week. After about a year or so… I had some, small portion of it. The students laughed.

So optimism is important, he went on. You have to be a little silly about the goals you’re going to set. You need to have a healthy disregard for the impossible, said Page. That’s a really good phrase. You should try to do things that most people would not!

Harry Beckwith shares the following true story in his book, Selling The Invisible.

Two men spent 7 years building a contracting company into a successful business. In 1995, a man came along and offered them $400,000 for the business. The company had no assets, employees, inventory, non-proprietary products or services, no accounts receivable, and no real estate.

The only assets were the name and client list.

It wasn’t the client list the buyer was after, since there was very little repeat business. In fact, repeat business wasn’t much better than a funeral parlor.

Moreover, the client list was only of any value at all if and only if the clients perceived, that in light of a transfer of ownership, that they would continue to receive the same standard of quality.

In other words… THE BUYER JUST WANTED TO BUY THE BRAND, after just 7 years of work.

A successful brand is money. Build your brand.

Please feel free to share your comments. I’m always thrilled to know if I’ve helped you, your business or organization in any way. - Brian

I can cite more than one instance in which one of my business development staff had celebrated their big meeting with that large “trophycase-worthy” prospective corporate client. “Finally!” they gasped. Their mouths watered at the sheer prospect of landing this huge new client with buldging budgets and liberal spending policies. Their years of feeding on business chum had finally paid off… or so they thought.

After landing their so called “big fish” client, they rapidly discovered a different reality than they’d previously expected. They learned that Joanne; Marketing Director for a large medical system conglomerate, had less money in her budget than several of our existing “maw & paw shop” and new business startup clients. And that ubiquitous billion-dollar oil and gas company they’d been stalking for months, was run by a CFO that survived the Great Depression… and who’d rather personally vacuum the offices each night, than pay for the opulent luxury of a janitorial service. Who woulda’ thunk it?

Don’t underestimate or under-appreciate your prospects and existing clients that have yet to appear on the cover of Forbes. According to the International Information Program, 99% of all independent enterprises in the country employ fewer than 500 people. Furthermore, some 19.6 million Americans work for companies employing fewer than 20 workers, 18.4 million work for firms employing between 20 and 99 workers, and 14.6 million work for firms with 100 to 499 workers. Agressively seek out smaller fish in bigger ponds. You’ll live longer.

Secondly, when you “are” going fishing for that large corporate prospect, manage your expectations. Understand that large corporations are extremely compartmentalized, and budgets are reluctantly passed down to department heads. Recognize that your proverbial foot-in-the-door might be a great step, but it’s likely to be the first of many on a long and strenuous journey.

Please feel free to share your comments. I’m always thrilled to know if I’ve helped you, your business or organization in any way. - Brian

Mandy; an executive at Microsoft, is looking to potentially recruit the services of a business consulting company. She remembers that her long-time friend and contemporary in Chicago had previously recruited a particular consulting company for similar purposes. Mandy calls her friend in Chicago to inquire about her experience.

In speaking with her friend in Chicago, she replies to Mandy… “I was satisfied.”

Does her lukewarm response inspire Mandy to pursue, let alone recruit the services of this consulting company? No. Absolutely not.

Continue to better your services and the experience of your clients. Don’t fall victim to the Lake Wobegon Effect, by believing that you’ve already arrived… that you’re better than you actually are.

You can always be better. Probably much better. Relentlessly refine and improve your services. Be exceptional!

Please feel free to share your comments. I’m always thrilled to know if I’ve helped you, your business or organization in any way. - Brian

HighScalability.com offers some secrets to Amazon’s amazing success based on interviews and writings of early employees. You might not be running an online ecommerce business, but many of these principles apply to virtually any business. Listed below are just 13 of their responses. I hope you find this post interesting and beneficial to your business.

1. Teams are small. They are assigned authority and empowered to solve a problem as a service in anyway they see fit.

2. They work from the customer backward. Focus on value you want to deliver to the customer.

3. Force developers to focus on value delivered to the customer instead of building technology first… and then figuring how to use it.

4. Start with a press release of what features the user will see and work backwards to check that you are building something valuable.

5. There’s bound to be problems with anything that produces hype before real implementation.

6.