TNT: Today Not Tomorrow


Nothing happens until something (action) happens.


Excellent managers create a sense of urgency and strive to create an environment of acting today and not tomorrow. “Even large opportunities, problems, and issues can be broken down into smaller steps (actions) that can be acted upon incrementally so as to deal with issues in a TNT manner. TNT is an enormously simplifying tactic.

In my software company I had a sign in the accounting and shipping areas that read “Bill it today/Ship it today.” Without that performance standard, we would have had to have systems in place to keep up with what had not been billed and what had not been shipped. TNT reduced work.

In addition to reducing work,  TNT is the right innovation method—small, fast, and simple. Break the effort into “quick turn-around projects”—build a model, jerry-rig it, test it with clients. Act-test-act!

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Check out "Who is Reading" my latest novel The Claret Murders!



Acres of Diamonds


Russell Conwell, a minister and the founder of Temple University, may be most famous for this “Acres of Diamonds” story—the retelling of an old fable similar to the American folk saying, “The grass always looks greener on the other side of the fence.”

Conwell tells of a man who wanted to find diamonds so badly that he
sold his property and went off in futile search for them. The new owner of his home discovered that a rich diamond mine was located right there on the property. The moral of the story is “dig in your own backyard” for opportunities.

Until you have learned the hard way, the things you have to do to succeed in your current endeavor always look harder than something else you might do. If you are in the hamburger business, the pizza business looks easier and more profitable. If you are in the home cleaning business, someone in your group is going to tell you you should change to commercial because it’s easier and the money is better. If you sell to lawyers, you know the problems and difficulties of doing so. It is hard to get passed the gatekeeper, and once you do, getting a decision is a challenge of monumental proportions. “Surely, it would be easier to modify our product or service for the CPA market. Lawyers are hard to please; CPAs would be easier. It’s easier to get an appointment, and they make decisions.”—You think? Wherever you are, where you aren’t looks better. At least it looks better to those who haven’t learned the lesson “you don’t know what you don’t know.” Don’t go looking for diamonds elsewhere until you first dig in your own backyard. As for grass looking greener on the other side of the fence, don’t fall for it. The grass may look greener, but it usually isn’t—it is riskier!

Igor Ansoff (1918-2002), considered by some as the father of modern strategic thinking, developed a graphic matrix that visually explains the basic strategies for business growth which at the same time provides an easy explanation as to why the grass is seldom greener. Rather than greener, it is riskier!
 The matrix illustrates the four basic strategies for business growth:

  1. Market Penetration – selling more existing products into existing markets, usually by increased sales staff, promotion, pricing changes, or new routes to market, e.g., online 
  2. Product Development – developing new products or services for the existing markets 
  3. Market Development – taking existing products or services to new markets. 
  4. Diversification – developing new products and putting them into new markets 

Risk increases as you move from 1 to 2 to 3 and then to Diversification, considered the riskiest.

Market penetration is digging in your own backyard. You have to avoid taking on the weakness inherent in becoming a market leader—as illustrated by Management Judo. Risk increases when you embark on developing new products to sell to your existing market, but the risk of failure really shoots up when you begin digging in someone else’s backyard, attempting to transition your existing products to new markets, or to diversify with new markets and new products. Success in doing so depends largely on the organization possessing a Core Competency upon which its strategy is based.

One of the important tasks in strategic planning is to identify your organization’s (or segment’s) strengths. Opportunities are derived from capitalizing on one’s strengths. Core Competency is a special kind of strength. If you have one, it can provide you with growth opportunities far greater than that of an organization without it.

Most enterprises will not have a Core Competency, and it isn’t a requirement for success. Businesses with one simply have avenues of growth that are not available to others. Examples of Core Competency include 3M for adhesives and coating and Black & Decker for small electric motors. Core Competencies enable an organization to launch a variety of end products often appealing to different markets with different needs to be satisfied.

Prahalad and Gary Hamel coined the term “Core Competencies” in the 1990s and set out the following test for identifying a core competency:

  1. It must provide access to a wide variety of markets, and 
  2. Contribute significantly to the end-product benefits, and 
  3. Be difficult for competitors to imitate. 


Core Competencies are rare, and, in their absence, growth through exploiting new markets and developing new product markets are high-risk ventures. Capitalizing on the organization’s strengths to expand penetration of its existing market—digging in your own backyard—offers the high value-to-risk ratio.

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Mysteries by Tom Collins include Mark Rollins’ New Career, Mark Rollins and the Rainmaker, Mark Rollins and the Puppeteer and the newest, The Claret Murders. For signed copies go to http://store.markrollinsadventures.com. Print and ebook editions are available from Amazon, Barnes & Noble and other online bookstores. The ebook edition for the iPad is available through Apple iTunes' iBookstore.

No Return Policy for Problems


I started my career as a CPA and transitioned to business after three years with Price Waterhouse. I envisioned myself as a problem solver. The difficulty with that was that there is always another problem right behind the previous one. I wish I had understood that success comes from pursuing opportunities, not problems. I discovered that most problems work themselves out. They are solved in the course of opportunity pursuits. After years of on-the-job training, my motto has become “Not all problems deserve to be solved; of those that do, not all of them need to be solved by me.”  When you do tackle a problem,  you should have a "No Return Policy."

Don't be an aspirin doctor--do not just treat the symptoms.  Find out why the problem exists. Get to the root cause. Your watch word should be that people do not fail, processes do.  Ask "5 Whys" Empirical observation indicates that five it typical number of iterations of questions required to resolve the problem--to get to the root cause. What guiding frame work for questions comes from the newspaper world--what, when, where, why and how. 

WHAT: What happen?
WHEN: Why did it happen when it did?
WHERE: Why did it happen where it did?
How: How did it happen?
WHY: Why did it happen?

Wikipedia gives the following different example of the "5 Whys":
The vehicle will not start. (the problem).
  1. Why? - The battery is dead. (first why)
  2. Why? - The alternator is not functioning. (second why)
  3. Why? - The alternator belt has broken. (third why
  4. Why? - The alternator belt was well beyond its useful service life and not replaced. (fourth why 
  5. Why? - The vehicle was not maintained according to the recommended service schedule. (fifth why, a root cause)

(possible 5th Why solution:
Start maintaining the vehicle according to the recommended service schedule.

To illustrate that there is no magic that indicates five whys are adequate, consider a possible sixth why: Why? - Replacement parts are not available because of the extreme age of the vehicle. (sixth why) 

Possible 6th Why Solution: Purchase a different vehicle that is maintainable.

The "5 Whys" technique was developed by Sakichi Toyoda and was used within the Toyota Motor Corporation during the evolution of its manufacturing methodologies. 

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Mysteries by Tom Collins include Mark Rollins’ New Career, Mark Rollins and the Rainmaker, Mark Rollins and the Puppeteer and the newest, The Claret Murders. For signed copies go to http://store.markrollinsadventures.com. Print and ebook editions are available from Amazon, Barnes & Noble and other online bookstores. The ebook edition for the iPad is available through Apple iTunes' iBookstore.

A's Love A's


Excellent managers don’t motivate people. They hire motivated people—people who are goal-driven consistent with the goals of the organization. While leaders cannot motivate, they can extinguish motivation. The leader sells a vision of how individual goals are achieved through the organization’s goals. People want to belong—and belong to something that recognizes their own value. If you want the right people on the bus, you start with the right people. Steve Jobs but it this way:  “A”-level people want to be part of an organization of “A”-level people.

The organization wants people who want to travel north on I65 North. Sunday drivers need not apply. People who want to travel south, east, or west should look elsewhere.

Motivation is not externally created. What excellent managers learn is that they can’t change the individual, but they can change people. Excellent managers do just that. They understand that keeping the wrong person extinguishes motivation in others. A’s demand A-level performance from their peers. When you allow less than A-level performance, you degrade everyone.


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For a beautiful evening join me on April 9th 2013 at the Belmond Mansion in Nashville Tennessee for High Tea.  Click here for more information. 


Code Name Circle


There is an old saying that two can keep a secret if one of them is dead. Regardless of how hard you try, the circle of those who know continues to expand until it becomes public knowledge. Nevertheless, the reality is that there are times when premature communications would be damaging or would jeopardize an important event. When management attempts to manage disclosure to prevent premature communications, they must exercise great care to protect their integrity. To achieve excellence, management must engage in constant communications but that communication must be honest and sincere. A lack of communication, a lack of integrity, or a management viewed as keeping secrets leads to destructive alternative communication systems—the grapevine, rumor mill, and boss interpreters who explain what the boss really meant, etc.

Excellent managers can manage secrets but only for the purpose of disclosure at the latest possible time. To put it differently, while they cannot keep secrets they can manage disclosure for the purpose of avoiding premature disclosure. Acquisitions, new product development or releases, major reorganizations, significant price restructuring, opening or closing a facility are examples that might warrant steps to avoid premature communications especially during periods of preliminary consideration or planning.

Any secret involves an expanding circle of people. As time passes more and more people become part of the circle—they learn the secrets and assume a duty to protect it until the appropriate time for the information to become public knowledge. Code words are used by excellent managers when disclosure has to be managed. The existence of a code name is a constant reminder of the sensitive nature of the event. Code names allow reference to an event or activity without disclosure of its nature. As more people enter the expanding circle, the existence of the code word helps in the integrity department because it coveys to those new people a sense of importance of preventing premature disclosure. As people enter the expanding circle, they may be brought into the fringes of knowledge by receiving only partial disclosure. To maintain integrity they must know that they are receiving only limited facts—they are not being given the whole story or the final story. The code name helps in that regard. It implies an obligation on their part to accept the incomplete disclosure without attempting to uncover other details, and it conveys their obligation to protect the confidential information from others—those outside of the circle.

When public disclosure is about to occur, every effort should be made to first communicate it fully to the whole organization—make every employee a member of the code name circle. The team members who are becoming part of the expanding circle for the first time also need to know why the information was not divulged earlier. Excellent managers do the following:

  1. Refer to the event by its code name. 
  2. Explain the reason for avoiding premature disclosure.
  3. Go over the timeline leading up to the current disclosure.

These three steps are important to maintain the integrity of management’s ongoing communication. Rather that exclude employees, the steps are a way of bringing everyone into the circle as soon as management can do so.

If it is not possible to disclose to the team before a public announcement, the same three steps should be carried out in a team-wide event that is held separately but simultaneously with public disclosure. It is also valuable for the team to understand, as a part of management’s communication, that while the organization is not in the business of keeping secrets there are times when premature disclosure must be avoided, and the Code Name Circle is how we manage those situations.

As part of management’s communication, it is valuable for the team to understand that while the organization is not in the business of keeping secrets there are times when premature disclosure must be avoided, and the Code Name Circle is how those situations are managed.

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Two 2013 events, April 9th  and June 7th, for you to consider:
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Razor Strategy



The excellent manager is a restless one. He uses transformative strategies to move from one life cycle to another and strategies like the Long Tail, Blue Ocean, and the Razor for a competitive advantage and/or increased results. The Razor Strategy is three-step classic road map that has been used by many entrepreneurs to transform a moderately successful service business into a significant financial success. A similar approach can be used to transform a product company.

For the service company:

  1. In step one, you figure out how to package the business’s services in order to market and price them like a product (the razor).
  2. In step two, you figure out how to add a service component (the razor blade) to the packaged service product.
  3. In step three, add amenities around the product and services to create a unique, high-value experience for the customer. 

Product companies can be transformed by adding a service component (razor blade) to provide a continuing revenue stream and forge a lasting relationship with the customer. Make it easier for the customer to acquire the product (the razor) in order to secure the ongoing service revenues. Then amenities can be added to create a unique, high-value experience for the customer.

Why is it important to create the “blade” component for your business? Product companies have to resell their product every year to produce revenues. In effect, the top line on the income statement of the product business starts at zero on the first of every year. The top line of the “blade”-orientated company is cumulative from year to year. Each year’s new sales are added to the revenue line. It does not go back to zero.

Coffee companies transformed their business by selling coffee systems and coffee clubs where existing customers reorder coffee for the product (the system). They added exclusivity, deluxe packaging, and exotic blends to provide a unique customer experience. Printer companies dramatically reduced the cost of printers in favor of recurring ink/toner sales.

In a law firm example, an estate practice bundles its services in several different packages where each targets to different segments of the population: the up-and-coming professional, the young married couple, and the mature high-net-worth couple. The packages are sold for a fixed price, and promotional materials use the same look and feel as the brochure for a car. They add an optional monthly fee to its service package. This “razor blade” service includes updating the documents for changes in laws and keeping the client informed of any changes or expected changes in taxes, laws, court decisions, and regulations that might affect their estate or estate plan. The estate practice adds an addition to its office along with an upscale hospitality staff, all specifically designed to cater to their more affluent clients. Everything about their high-worth-focused facility and services reinforces the special VIP status of the firm’s opulent clientele. The experience provided for the clients’ benefit raises the firm to an entirely new level, attracting more targeted clients.
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Mysteries by Tom Collins include Mark Rollins’ New Career, Mark Rollins and the Rainmaker, Mark Rollins and the Puppeteer and the newest, The Claret Murders. For signed copies go to http://store.markrollinsadventures.com. Print and ebook editions are available from Amazon, Barnes & Noble and other online bookstores. The ebook edition for the iPad is available through Apple iTunes' iBookstore.

Tom.Collins@SixtyFiveNorth.com
http://www.sixtyfivenorth.com





The Other Side of Moore’s Law



The conventional concept of Moore’s Law is that the power of technology doubles about every two years, but the impact of the mirrored, or reverse, side of Moore’s Law has greater consequence. Promised advantages of Moore’s Law are options to take advantage of increased benefits. There is nothing optional, however, about the mirrored impact—it’s an uncontrollable rate of decay in value.

Technology is so embedded in products and services today that the reach of Moore’s Law extends deep into our economic system shortening the lifecycle of any given product or service. The consequence is that the long-term value of a given “thing” (product, process, or service) is near zero. The enduring value of a “thing” is in the ongoing capacity to evolve it—moving from one lifecycle to another. Without the capacity to continually innovate, update, redesign, and replace the “thing” will have a short life and quickly wind up in the graveyard of outdated companies, products, and ideas.

I have admittedly stretched the application of Moore’s Law, shown below, to convey its more general influence now that technology has become a direct, or indirect, component of most goods and services:

The observation made in 1965 by Gordon Moore, co-founder of Intel, that the number of transistors per square inch on integrated circuits had doubled every year since the integrated circuit was invented. Moore predicted that this trend would continue for the foreseeable future. In subsequent years, the pace slowed down a bit, but data density has doubled approximately every 18 months, and this is the current definition of Moore's Law, which Moore himself has blessed.
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A beautiful Nashville lawyer, an inheritance at risk, a devastating storm and wine to kill for—The Claret Murders, a new Mark Rollins adventure.





Recession Opportunity



Recessions are periods of opportunity for the prepared company.  The sound strategy is a contrarian one—going against the herd.  Increase spending during recessions. Build dry powder during booms.

The majority of businesses, including your competitors, react to an economic downturn in the same way.  First, they are usually unprepared.  They immediately look for discretionary expenses that can be curtailed immediately.  Investments in plant and equipment go first.  Employee travel goes next including sales-related travel—advertising follows quickly, as does exhibit events.  In other words, they hunker down.

Excellent companies aren't surprised by a recession.  They understand that business cycles are a fact of life.  They don't suffer from a lack of corporate memory because they have built into their strategic plans several tactics to prepare for, and respond to, economic recessions.  While others curtail marketing activities, they increase them, including advertising expenses.  Rather than shrink their sales force, they snap up quality personnel laid off by others.  Rather than cancel exhibit events, they increase their footprint on exhibit floors.

For the prepared companies, recessions are bargain periods when companies can get the best deals for expanding facilities, adding or upgrading equipment and systems, and provide one of the best climates for hiring top-notch people.  However, it is a company's increased investment in marketing that pays off the most.  Companies that do, come out of recessions with increased market share and financial strength.

It is the recovery and boom periods that are best suited for consolidating your gains and strengthening your financial health and operating performance.  During these periods, you prepare for the next downturn by developing "dry powder"—emphasizing improved planning, workflow efficiency, and the overall performance metrics.  This is when you want to invest in dry powder and equipment, systems, and facilities that will improve workflow efficiency and performance.  But you do not want to fall into the trap most companies will construct for themselves.  Most companies, including your competition, respond to boom periods by overreaching and overextending.  They increase financial leverage, deplete cash reserves, exhaust lines of credit, and max out borrowing power.  When the next recession hits, they will have no choice but to conserve cash—and that means hunkering down, including drastically reducing marketing expenditures.

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A beautiful Nashville lawyer, an inheritance at risk, a devastating storm and wine to kill for—The Claret Murders, a new Mark Rollins adventure.

Integrity

Excellent companies have integrity.  Integrity comes down from the top.  The leader has to have it and expect it from everyone on the team.  An individual who is known to possess integrity is said to carry weight with people in general; thus the pound sign is regarded as a symbol for integrity and honesty.  People with integrity can be trusted. 

You can’t just go through the motions.  That isn’t integrity.  A concern about customers can’t be satisfied with self-serving surveys or frequent flyer programs.  Common Courtesy, treating customers as The Force, caring has to be real, deep-seated, and sincere.  People resent a lack of integrity.  They know when you are just going through the motions.

Every person at a cash register will ask you, “Did you find everything you wanted?”  Very few really care about your answer.  Almost none of them will take action in response to a negative answer.  The most common answer by the cashier is “After you have checked out, you can go to our customer service desk to tell them.”  In short, they have been trained to go through the motions. They have not been freed and authorized to solve your problem as a customer.

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A beautiful Nashville lawyer, an inheritance at risk, a devastating storm and wine to kill for—The Claret Murders, a new Mark Rollins adventure.

Structured Planning

Structured Planning:While planning is a continuous and dynamic process, that doesn’t mean it lacks structure.  It has to have a starting point; and then it is dynamically adjusted and communicated as conditions change, assumptions are adjusted, and temporary targets are replaced with new ones, etc.  The Structured Planning icon above conveys that one cannot develop operational plans or budgets without having a strategic view that those operational plans and budgets support.  Structure is a critical part of the planning process, and the one I have followed over the years involves nine main areas to be addressed—and continuously readdressed—by the planning team in the order listed.

Nature of your enterprise (business, division, group, etc.):  What it is and how it operates today:
History of the business (outline of important events); Organization, key management, committees; Billing methods and collection methods; Products, services, expense recovery method; Description of the market; Recruitment; Marketing, networking, referral practices, sales methods; Client intake methods and standards; Competition and market share; Quality control and client satisfaction.

Historical performance: Five-year financials which benchmark comparisons of key performance indicators such as days of inventory, days to collect bills, margin percentage, customer satisfaction—the key success drivers for your particular business, department or activity.

Environment in which you operate:
Economic conditions; Labor force; Technology; Governmental issues; Nature of market and competition.

Opportunities/Capabilities (SWOT):
Our strengths; Our weaknesses; Threats; Our best opportunities such as: new products to existing clients-same products to new markets-new products to new markets-performance improvements.

Assumptions:
Economic; Labor force; Technology; Governmental impacts;Nature of market.

Objectives—Mission/Strategic Thrust:
Mission, goal and/or objective; Main things required to achieve objective; The main opportunities and the risks and/or weaknesses that require action; Strategies for achieving those main things; Tactics or programs to implement or support strategies.

Policies/Procedures (changes or new ones needed):
Existing policies requiring change, New policies needed.
Strategies/Programs Summary:
Main things for success of each strategy; Tactics (programs) to implement strategies; Key indicators (measurements) of achievements.

Priorities and Schedules:
Programs; New processes; New assets or resources; Measurement capability.

Organization and Delegation: Organization Chart; Who is responsible for what? Job or position descriptions.

Once the overall strategic plan is developed, each major department or group should go through the same planning process, and that planning process becomes input into the firm-wide plan.  Which comes first the chicken or the egg--the strategic plan or the operational plan, the enterprise-wide plan or the segment plans, etc.?  The answer is each is shaped by the other over time.  Since planning occurs continually, it is impossible to tell.
 
Planning is a discovery process.  Sometimes it is a discovery of the obvious and sometimes it breaks new ground.  The one thing you can count on is that we are far more likely to get there if we know where we are going and how we are supposed to get there.  I refer to that as I65 North.  I65 North is a reminder that the business is a journey and that leadership’s job is to get all of the firm’s people traveling in the same direction.  Planning gets the team playing from the same playbook.  It prepares the team for the future, equipping it to capitalize on its opportunities. 

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Mysteries by Tom Collins include Mark Rollins’ New Career, Mark Rollins and the Rainmaker, Mark Rollins and the Puppeteer and the newest, The Claret Murders.   For signed copies go to http://store.markrollinsadventures.com. Print and ebook editions are available from Amazon, Barnes & Noble and other online bookstores. The ebook edition for the iPad is available through Apple iTunes' iBookstore.

Measurement Improves Performance


 Measurement improves performance, and successively higher standards or goals result in successively higher achievement.  It is the idea so frequently evidenced in athletics by the announcement, “It’s a new record!”  Excellent companies use goals, and excellent companies keep raising those goals.
 
The most important set of measurements to develop are the organization’s KPIs (Key Performance Indicators).  These are the top line metrics that must be achieved for the enterprise (or supporting unit, division, plant, department, group, etc.) to meet its objectives.  KPIs can be both financial and qualitative, but should be highly correlated with the top priorities of the firm and the firm’s business model as developed during strategic Planning. Furthermore, if there are more than ten KPIs you probably have too many.  That goes for the KPI at the enterprise level or the KPIs for any of its supporting components.
 
My son was part of the Colgate-Palmolive finance team from 1992 to 1997.  He reports that they managed their entire worldwide operation with 10 Key Performance Indicators.  The first thing every business unit’s general manager would review when presenting to the CEO would be their results against those 10 KPIs.  The rest of the meeting was spent explaining how they achieved their goals or why they did not meet them.  It’s hard to believe a huge Fortune 500 company could manage a global operation using 10 measurements of success, but it’s true—and it was VERY effective.  Colgate is one of the most reliable businesses when it comes to consistency and predictability of revenue and earnings growth, and their KPI system is a key element of success in this regard.

I spent a good portion of my career working with law firms.  For them, KPIs included such metrics as leverage, effective rate, productivity, realization, days to bill and collect, client intake, closed cases, etc.  Whatever the nature of a business or organization, its success depends on certain main things and those main things should be the subject of your KPIs.
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It's Nashville...with a devastating flood, abeautiful lawyer, a deadly secret, and wine to kill for--The Claret Murders, the latest Mark Rollins mystery adventure.

Eyes Forward


You are not going to get where you want to go looking in the rearview mirror.  Excellent managers keep their Eyes Forward.  They want to know how they are doing, not how they did.  The traditional tool for gaining that knowledge has been MBWA, Management by Wandering Around.  Wandering Around meant you were in touch with your business as of that real point in time.  You were experiencing, up close and in person, the Event Horizon.

Event Horizon is a boundary in space/time beyond which events cannot be observed.  It is real time.  It is how things are right then!  Except for personal experiences from MBWA, every other piece of information available to that traditional manager was looking backward.  The manager in the late 1900s suffered from information overload, but all of it was out of date.  For centuries management was been at a disadvantage because their information systems only told them about events occurring well in the past.  It was all about events that had already occurred.  By the time it got to the manager, it was too late to take any action that would change or improve outcomes of events and transactions reported upon.

 
Times have changed.  Management by Wandering Around has taken on an entirely new meaning.  Now we can “wander around” through technology and social media.  Excellence companies are hungry consumers of technology that will put them closer to the Event Horizon.  They use social media, blogs, websites, and cloud-based tools to have real time contact with customers.  They track, in real time, customer Internet reviews and comments about the company's products and services as well as the products and services of competitors.  Using technology and wireless communication facilities, excellence companies can and do operate at, and sometimes just over the edge of, the Event Horizon.  Technology, including trend analysis, forecasting, real time tracking systems, and social media monitoring, can show us what will occur if we fail to take action now to alter the future.  Information guides an organization to its targeted goals provided that information is timely, relevant, accurate, comprehensive, and navigable.  And today’s Executive Support Systems (ESS) do just that.  They gather, analyze, and summarize the key internal and external information.  They provide the modern executive with aircraft cockpit-like command and control—with instruments showing the status of all key metrics necessary to “keep the plane in the air” and accomplishing its mission.  Excellent companies keep their Eyes Forward and never go second class when it comes to technology that puts them at the Event Horizon.
 
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Mysteries by Tom Collins include Mark Rollins’ New Career, Mark Rollins and the Rainmaker, Mark Rollins and the Puppeteer and the newest, The Claret Murders.   For signed copies go to http://store.markrollinsadventures.com. Print and ebook editions are available from Amazon, Barnes & Noble and other online bookstores. The ebook edition for the iPad is available through Apple iTunes' iBookstore.
 

Luck Favors the Prepared


 

Change (especially uncertain change) is the stuff of opportunities—provided you have developed a way of thinking that prepares the firm to take advantage of whatever the future brings.  The French scientist Louis Pasteur said it in one short sentence: “Chance favors only the prepared mind.”  If Pasteur had been English, the quote would have been, “Luck favors the prepared mind.”
 
When consulting with a midsize law firm a few years ago, I suggested that the partners adopt the practice of meeting monthly for a half-day session where they did nothing but think about things that could happen and then thinking about how they could happen differently.  The mission would be to identify strategies that would allow the firm to benefit rather than suffer from these events.
 
Suppose, for example, that a member of the law firm is arrested for unsavory activities unrelated to the law firm.  What steps should the firm take?  Suppose a major local corporation with significant legal needs loses its general counsel unexpectedly.  How could the law firm respond in a way to take advantage of the situation?  Suppose a single-payer health system is adopted by the U.S. government.  What problems and opportunities occur if Mexico nationalizes American businesses? How would the firm respond to another Enron?  What happens if outside investors are allowed to own U.S. law firms?  Suppose a major client of the law firm contemplates moving its headquarters to a state where your firm doesn’t currently practice?  How should your firm respond to a news release that a major U.S. corporation is relocating its headquarters to your area? What if events similar to those that destroyed Arthur Anderson occur with respect to a U.S. mega law firm?
 
Could the firm have anticipated the events involving Big Tobacco, the rise of the overnight letter business, the advent of Amazon.com, or the wave of refinancing sparked by falling interest rates?  Could the firm have been better positioned to take advantage of Sarbanes-Oxley?  Is the firm prepared for the next Katrina? Does the fact that 3.6 million Americans will turn 65 in 2012 open opportunities for your firm?  Can the firm take advantage of a major changing of the guard in corporate America?
 
If the firm follows my suggestion, that “thinking outside of the box” exercise is likely to become the firm’s vehicle for rapid response to real-life events which will position the firm to capitalize rather than suffer from uncertain future events.  Chance, Luck, Opportunities—whatever you call it—it can best benefit those who are prepared.  Practice prepares a business team to take advantage of events that surprise others. 
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Mysteries by Tom Collins include Mark Rollins’ New Career, Mark Rollins and the Rainmaker, Mark Rollins and the Puppeteer and the newest, The Claret Murders.   For signed copies go to http://store.markrollinsadventures.com. Print and ebook editions are available from Amazon, Barnes & Noble and other online bookstores. The ebook edition for the iPad is available through Apple iTunes' iBookstore.

Previous issues of Newsletter

If you are looking for previous issues of The Language of Excellence newsletter; you can find the links on http://www.i65north.com. Select the tab Language of Excellence.

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Mysteries by Tom Collins include Mark Rollins’ New Career, Mark Rollins and the Rainmaker, and Mark Rollins and the Puppeteer and the newest, The Claret Murders.   For signed copies go to http://store.markrollinsadventures.com. Print and ebook editions are available from Amazon, Barnes & Noble and other online bookstores. The ebook edition for the iPad is available through Apple iTunes' iBookstore.


Count the Teeth


Planning is not an intellectual forum for speculating on the determinable.  The Teeth icon is a reminder of the story about two Roman citizens debating the issue of how many teeth were in a horse’s mouth.  A slave overheard the debate and suggested they count the teeth.  They killed the poor knave on the spot for upsetting their enjoyable debate.
 
The excellent manager should insist that the teeth be counted not debated.  Who is buying our competitor's products and why are they buying theirs, is a question that can be answered by counting the teeth—don’t speculate!  Counting the teeth often means asking for answers.  When you want to know “how to do it better” or “what customers really want,” counting the teeth means asking.  However, you only get answers when you listen.  Too often organizations ask in an effort to validate their own view.

Do you really think those political surveys we receive in the mail are designed to get our input?  Excellence in management means asking—and listening to—customers, employees, vendors, etc. 

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Novels by Tom Collins include Mark Rollins’ New Career, Mark Rollins and the Rainmaker, and Mark Rollins and the Puppeteer and the newest, The Claret Murders.   For signed copies go to http://store.markrollinsadventures.com. Print and ebook editions are available from Amazon, Barnes & Noble and other online bookstores. The ebook edition for the iPad is available through Apple iTunes' iBookstore.

The Long Tail Strategy


In modern times,enterprises have had business models that have been heavily influenced by the law of Disproportionate Results—the 80/20 rule.  In the world of brick-and-mortar, 80% of results were traditionally derived from only 20% of the activity—sales, inventory, paperwork, jobs, space, etc.  Management’s job involved constant diligence to eliminate low yield or nonproductive activities.  Unfortunately that often meant a decline in service and a slow but relentless movement toward sameness.  It was as Toffler had predicted a world of unlimited choices—all the same.  You can have anything you want as long as it is within the 20% of alternatives that 80% of the population wants.


The 80/20 rule is still important when dealing in tangibles but something important has happened.  No longer does the 80/20 rule dominate.  It is called the Long Tail, and it is the new dog on the block.  In the digital world, the right side, or tail end, of the bell-shaped normal curve goes to infinity without ever reaching zero.  When the cost of maintaining inventory, handling transactions, and distributing products or services drops to near zero, the Long Tail of the bell curve becomes as rewarding as its center—the center that used to account for 80% of all activity.  Today you can have any song, any book, and any video—even though they, long ago, became no longer economically feasible to keep on store shelves.
 
Today’s excellent businesses look for opportunities to operate in the Long Tail while being mindful of the 80/20 rule in other aspects of their business.  Nor does one's product or service have to be digital to gain some of the benefits of the Long Tail.  The key is to reduce the cost of maintaining inventory, handling transactions, and distributing the product or service.  When these cost are reduced, the Long Tail benefits become realizable.
 
When it comes to sustaining their financial success, we have seen printer manufacturers shift their emphasis from hardware sales to the profitable revenues produced by selling the ink used by that hardware.  The ink has low inventory and distribution cost when compared to those costs for the hardware.  We see coffee services shift from relying on the profitability of the coffeemakers to the revenues produced by selling the coffee used by the coffeemakers—the coffee having a lower inventory and distribution cost.  Excellence companies look for ways to capitalize on the Long Tail while being considerate of the 80/20 rule. 

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Join me January 22, 2013 for a glass of claret.  I will be at Parnassus Book Store in Nashville signing the new hard cover edition of my novel, The Claret Murders. In keeping with the main character’s reputation as an epicurean, there will be also be caviar to go with your wine. We will have a lively discussion, some readings and prizes--one of those will be a thirty year old claret from my private cellar, a 1982 Chateau Sociando-Mallet.


Blue Ocean

Blue Ocean

Creative excellent managers don’t accept the prevailing rules.  They don’t settle for coloring inside the lines.  They look for ways to reinvent how the “wants and needs” of customers and prospects can be satisfied.  They look for opportunities to increase benefits that have so far gone unsatisfied.  They look for ways to reinvent how products and services are delivered.  Today there are successful businesses that no one could even imagine a few years ago.  Peter Drucker would say they created utility where there was none.  Thomas Edison did that when he created the electric light, the phonograph, and moving pictures.
 
W. Chan Kim and Renée Mauborgne gave this strategy a name.  They call it the Blue Ocean Strategy (BOS).  They call traditional businesses Red Ocean businesses.  In the Red Ocean, traditionally, businesses compete with other businesses for the same customers to fill the same need.  They compete in the same ways.  It is a game of one-upmanship—for one business to gain market share, another has to lose.  The Red Ocean is one where businesses ebb and flow in terms of competitive victories and losses.  In the Red Ocean no business will consistently succeed.  Leadership styles are transient.  Successful strategies do not continue in perpetuity.  Applauded leadership methods fail with changing circumstances.  The Red Ocean is a place where victories are only marginal improvements.
 
Under the creative excellent leader, a corporate team looks for opportunities to stop playing the Red Ocean game with all the other wannabes.  They create a new market, a Blue Ocean, where they are the only player.  It is the notion of reinventing the business, but kicked up a notch.  For example, it isn’t a matter of just reinventing how existing products or services are provided to existing consumers.  Instead, it is a matter of reinventing how the needs and wants of those customers are satisfied and inventing ways that those who currently don’t take advantage of a particular product or service can get the benefits.  With the Blue Ocean Strategy you reinvent the market, not just the business enterprise pursuing that market.  You break out of the box where everyone competes for the same business.
 
A pure Blue Ocean is an entirely new industry, created by bringing in neglected potential customer segments through offering them compelling buyer utility not currently offered anywhere.  Making the breakthrough to a pure Blue Ocean is not something every group—no matter how creative and how exceptional—will achieve.  But the constant effort to turn the water Blue is a mark of the excellent manager.  Imagine, for example, the impact on the hotel/motel business of breaking away from the fixed check-in and checkout time.  Why is that standard? Why can’t hotels operate like rental car companies—check in any time and check out anytime.  The fixed check-in and checkout time is an example of practices that become industry standard practices that do not serve the customer. Practices that reduce the customer's benefits should be the enemy of the excellent manager.

PayPal, Stamps.com, and Bazaar Voice are notable examples of Blue Ocean companies and so was Southwest Air who eventually changed how airlines compete.  So were FedEx and Starbucks.  Amazon is changing how people shop and read books.  A creative telecom carrier in Africa is creating a Blue Ocean by launching products that allow money to be transferred between mobile users across all mobile telephone networks.  Africa is a country where mobile devices, solar power, and wireless communication are transformative; and telecom carriers are in a position to bring brick-and-mortar-type services to the masses.
 
Kim and Mauborgne are the authors of the book Blue Ocean Strategy: How to Create Uncontested Market Space and Make the Competition Irrelevant.  It was the product of years of research by the authors and collaboration with fellow faculty and students at INSEAD.  The French graduate business school and research institute, INSEAD, is considered one of the world’s best.  It is particularly known for its influential alumni—a global network of business intellect and power.
 
Gabor George Burt, a graduate of INSEAD, is one of the apostles of BOS.  His blog, http://blueoceanstrategy.typepad.com is a valuable supplement to the original work of Kim and Mauborgne.

In my Novel Mark Rollins’ New Career and the Women’s Health Club the main character, Rollins, reinvents the fitness center into a unique Blue Ocean business.  The WHC, as members call it, also serves as the “Bat Cave” for this modern day avenger and has continued to play that role for three more Mark Rollins adventures:

Common Courtesy



What kind of enterprise do you want to be?  What kind of company can get the right people on the bus?  What kind of organization can have customers who like that organization?  What one zero tolerance prerequisite should be maintained within the organization?  The answer is “CC”—common courtesy.  Achieving and maintaining excellence depends on successfully installing that quality throughout the organization—the quality of caring and showing it.  Customers accept nothing less.  If they don’t get it, then if they have an alternative, and eventually they will, they will take it.  The same is true with the organization’s best people, best vendors, etc.  Remember we are always judged by others, and “CC” is the gold standard.

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A beautiful Nashville lawyer, an inheritance at risk, a devastating storm and wine to kill for—The Claret Murders, a new Mark Rollins adventure.
 
 

The Force


 
In Star Wars, the Force flowed throughout the universe influencing all things.  In business, the customer is “The Force.”  Customers—and customers only—produce revenues and decide if a business will have the opportunity for results.  All else is cost!  Customers are the only source of revenue.  Excellent businesses are above all else customer oriented.  They press the flesh; they show the flag; they ask, and they listen.  They like their customers and their customers like them.

PS:
On January 22, 2013 starting at 6:30pm I will be signing my books and reading from the latest Mark Rollins adventure, The Claret Murders, at Parnassus Books in the Green Hills area of Nashville.
For more information go to http://www.parnassusbooks.net/event/author-event-tom-collins.

Playbook

Playbook
Do plans need to be in writing?  Yes, but in a form that serves its purpose.  That is not as a bound volume that resides on a bookshelf never to be referenced once the creators have “finished” their planning task.  It is a communication vehicle—best conveyed in words, phrases, short paragraphs, charts, key performance indicators, and pictures.  It should be in a form easily changed and updated.  It should not be burdened with the niceties of a literary quality.  Its purpose is to have every member of the team guided by the same “playbook.”
 
In this age of advanced communications and technology, the playbook should be maintained as an integral part of the enterprise’s internal systems.  Those internal systems should serve as the enterprise’s command and control center.  Their purpose is to empower members of the team by giving them the clarity needed for the confidence to make decisions and take action on the frontline.  Management is about achieving objectives through others.  It follows that maintaining and refining the “playbook” is job one for the leader.  In today’s world, the “playbook” isn’t one thing—it is the leader’s blog, the organization’s intranet site, it is periodic video conferences or planning retreats, it is the business’s key performance indicators, its bonus, commission, and reward plans.  Wherever possible, words are better than phrases, phrases are better than sentences, sentences are better than paragraphs, and paragraphs are better than pages.  That is because the excellence company communicates so frequently and so clearly, that words and phrases become triggers conveying much more extensive content.  The use of words and phrases makes the job of constantly communicating, refining, and changing the dynamic plan easier. 
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A beautiful Nashville lawyer, an inheritance at risk, a devastating storm and wine to kill for—The Claret Murders, a new Mark Rollins adventure.