John F. Welch Jr., CEO of General Electric, identifies four types of managers:
1) People who deliver on commitments and share the new values—retain and reward these people;
2) People who don't meet commitments and don't share the new values—these people must go;
3) People who sometimes fail to meet their commitments, but who share the values—give them a second chance;
4) People who meet commitments but don't share the values—they must change or go, because their results aren't worth the price.
Southwest Airlines has been successful hiring by the smile.
Power vs. Powerlessness
|Do the right thing
|See "them and us"
|Focus on task
|Focus on result
|CYA (cover your assets)
|See win/loss issues
|See win/win issues
Hire consultants for skills. Hire senior people for attitude and ability....
Most directors are stuck in a system that makes it tough for them to protect shareholder interests. The author offers two solutions.
The possibility of directors paying out of their own pockets for corporate misconduct occurring under their watch has been raised by three recent cases. On January, 18 Enron directors agreed to pay $168 million -- 10 of them spent $13 million of their own money -- to settle their portions of securities class-action suits. In February, a deal fell apart that would have had 10 former WorldCom directors settling shareholder lawsuits by paying a total of $54 million -- $18 million from their own pockets, representing 20% of their net worth. And Walt Disney (DIS) shareholders are suing the company's former directors -- demanding they repay a $140 million severance package awarded to Michael Ovitz, who spent an unsuccessful 14 months as the entertainment giant's president. If Disney shareholders...
As a CEO I struggled long and hard over any decision to use a consultant. There are many issues that need to be managed by the client to keep a consultant from going overboard on time and costs.
Too many need to long to get up to speed on your business (on your dime), cost too much, and can not provide tangible results on a limited project basis. Too many are unproductive and do things in ten hours that I know I could have done in 2-3 hours, as paying by the hour is often a demotivation, while paying by the task aligns the client's and consultant's interests more.
All that said, I currently make my living as a consultant and do believe there is a better way.
The old saying that a consultant is someone who you pay to learn your business who then goes down the street to sell that expertise to someone else next week can be true if you let it happen that way. But it does not have to be that way if you use consultants appropriately and as a...
Many software companies these days are built using some form of venture capital. But the VC industry has been hurting lately. A lot of investments in dot-coms turned out to be spectacular flame outs. As a result, VCs are becoming ever more selective about where to put their money. To get funded these days, it's not enough to be a pet shop on the web. Nope! You have to be a pet shop on the web with 802.11b wireless hotspots, or your business plan is going right in the dumpster.
The formerly secretive world of VC has become a bit more transparent, of late. VCs like Joi Ito, Andrew Anker, David Hornik, and Naval Ravikant has created weblogs that are a great source of insight into their thought process. That dotcom thing resulted in three great books by company founders that look deep inside the process of early-stage financing (see footnote). But as I read this stuff, as a founder of a company, I can't help but think that there's something...
What gets most early-stage companies in trouble is the areas that they just don't understand, that they don't know enough about. In other words, the biggest problem is that they don't know what they don't know. Nearly every failed company will say they ran out of cash, couldn't raise enough capital, or just did not get the sales they expected quickly enough. But these situations are generally the effect, not the cause. Generally speaking, other problems that the company or entrepreneur does not understand very well are usually the root cause. This situation is actually far more dangerous than just not knowing because you cannot tackle a problem that you do not even know exists. The best entrepreneurs and CEOs are learning machines and understand what they do not know. I call this the Prudent CEO or person that appreciates the fact that the last Renaissance man, or woman, existed hundreds of years ago. In this day and age, there is just way too much...
Note: This article was written in 2004 and has been updated, though the evolution of the market has continued traditional expectations in 2013 still seem to have faded.
The financing landscape today has changed radically. Everything you learned in the last 5 years is obsolete. We are back to looking like the early 1990s again as everyone has "moved up the food chain" one to two levels. True Series A financings with money designed to develop the product are very rare and most first institutional investments are in companies with proven "traction", this means lots of sales completed. In the past there were usually TWO rounds of financing before this was required, one to develop the product and another to accomplish the first several sales by testing the sales and marketing processes. This means you need to get much further on much less money. This can mean adding a service component to your market entry strategy, corporate partners, or many other strategies, but unfortunately,...
You can't be all things to all people
Ever notice how that last 10% of almost any job takes half the time or more? This is a simple fact of life in most tasks because the more detail you try to finish the further you get up that exponential cost/time curve to perfection. Even painting your house perfectly is an unachievable and ridiculously expensive goal. In fact, an excellent job will cost twice as much as a very good job, and that will cost twice as much as a "good" job, which will cost twice as much as an OK job. That means an excellent job can cost about sixteen times more (2 X 2 X 2 X 2 =16) than a good job! Think about that next time you get a fixed price quote! So you need to decide where you want to be on that quality curve, which is also exponential. How close will you want to look at that paint job to feel good about it? How much will customers want to pay? This fact of life applies to most products and services in some way.
Unlike large companies, where thousands of...
Early-stage companies are the most fragile, have the least resources and the biggest challenges ahead of them. Developing a new business is one of the biggest challenges in life and generally requires experience in at least five key disciplines (product/service development, finance, sales, marketing, and operations) to do well. For a founder or entrepreneur and their team to be successful, they must have not only industry domain experience but all these skills available to design the business at both the strategic and tactical levels (a vision). Taking all these disciplines into account and then allocating resources appropriately for the specific situation among these areas requires much experience and entails many trade-offs and judgment calls. The only experience can be our guide here. Identifying and managing risks is also something only experience and knowledge can conquer. For very early-stage businesses, hiring a full-time,...
Where Are Your Company's Customers Now? Only in the top right "Loyalty" is a sustainable business, everywhere else is living on borrowed time.
Examples of Poor Customer Service
Customer service seems to be going down the drain today at more companies than not. It is difficult to have a remote customer experience or transaction with any significant size company without several problems along the way. It is much less of a problem where there is face-to-face contact than on the phone, so I am confining this to telephone service issues.
I recently wanted to add a second satellite dish to my house and also upgrade to a high definition dish with a large, well-known company that provides satellite signals directly to your home TV (who shall remain nameless). Although I am still working on this, I have now spent over two and one-half hours talking to people on the phone and being stood up three times in a row...
What are TODAY'S real top priorities for both you and your company? They may have changed since you last looked.
If you're busy slaying daily dragons, priorities can change without warning. And you may not even notice -- until it's too late to do something about it. Instead of dragons setting the agenda for you and your company, invest ten minutes on this pop quiz.
Because either you or your daily dragons WILL control your Agenda for the Future.
It won't take long to review which of these thirteen major issues are the most critical ones to your future. It's not complicated. Either print out this page using your web browser software and circle them -- or just jot down on a sheet of paper which ones are top priorities for you.
Biggest Problems Currently:
Almost by definition, your five biggest problems are those that are specific to you and...