Planning, Startups, Stories

6 Resolutions for Planning That Works

Here it is New Year's Resolution time and me with a computer, free time in an Internet cafe, and really looking forward to 2008. And still committed to business planning as the key to better management, for both new companies and existing companies alike.

I call it plan-as-you-go business planning. That means planning that actually works to help you control your business destiny, start or/and grow your business, introduce long-term directions and goals, and manage accountability and implementation.

So I'm going to suggest some resolutions you should add to your list:

1. Set a schedule today for regular planning reviews, an hour or two every month, and then three hours or so once a quarter. Get those review meetings on the calendar now, and make sure the people who should be there know about the dates and keep their schedules free.
2. Review the metrics that make your business go. Obviously that's cash flow first, sales and profits second. But also whatever other metrics drive your business. Look for measurable trackable metrics for key elements, like repeat business, or calls, or time per call, or trips or presentations or whatever. Review those metrics.
3. Review the heart of your plan, meaning the interplay between what your market wants, what you want and do well, and the focus required to bear down on the keys to success.
4. Do a SWOT analysis. That's strengths, weaknesses, opportunities, and threats. Bring your key people into the session, build a list of bullets, start thinking.
5. This year make your planning collaborative, meaning that nobody gets locked into the crystal ball and chain, stuck with doing something just because it's on the plan.
6. Put your assumptions on top, where you can identify changing assumptions as soon as they happen. And keep those assumptions on top, where you'll review them with every plan review. Remember that when assumptions change, the plan may have to adapt.

So that's a quick list for now. With your permission, I hope I can reserve the right to revisit in a few days.

Small Biz Labs: The SBA on Self Employment

Thanks to Steve King for this post this morning. Although I'm not working today, I'm still trying to keep up and pass the good stuff on, and this is good stuff: 

I've been crunching through the SBA's annual Small Business Economy report. They have an interesting table on self employment showing that about 10% of Americans are self employed (Table 1.3 on page 20).

Going to the more detailed data on Table A.13 on page 318, we find that total number of self employed is 15,739,000 and that the number of self employed grew by 13% between 1995 and 2005.

Other interesting data is that Hispanic self employment is up almost 100% during that period and self employment among those 55-64 increased roughly 47%. Both populations grew during the period, but the numbers are still quite impressive.

The SBA also has a working paper on this topic that reports that individuals with more schooling are more likely to choose self employment, as are those with more wealth and those with military experience.

Small Biz Labs: The SBA on Self Employment

6 Tips For Involving Your Kids in Your Business

Do you own a business? Do you have kids? Do you want them involved in your business? Do you want them to run it one day? Oh, and by the way, do you get a day older every day?

This came up in conversation the other day, talking to women who will be on a panel with me next month at the Women's Congress in Miami. My daughter is CEO of my company now and two other daughters are among the 40 employees.

The question was whether I did that on purpose, or what did I do to make that happen.

Ironically, given that I'm a planner by profession, this was not the result of long-term planning, at least not exactly.

It took me years to connect in my mind my entrepreneurial business plan software business, Palo Alto Software, with the idea of family business. Even as several of our five children, then in their early teens or preteens, spent Sunday mornings sticking product labels on plastic floppy disks. Even as they took turns, as teenagers in high school, at answering the telephone in the office, it didn't occur to me.

If you're thinking to yourself, as you read this, that I must be pretty dumb, I say yes, that's true, but on the other hand, this was a software business started in the heart of the Silicon Valley during the first PC boom, by an entrepreneur with a Stanford MBA degree. It wasn't the kind of thing people normally associate with family business.

And also it took me years to recognize that exit strategy or succession could be relevant. I've loved the business for so long that it had become second nature.  The thought of retirement was horrible, but I didn't realize that I didn't have to retire, just change jobs.

As it turned out, what did happen was the gradual recognition that I could change my job and put somebody else in charge, without retiring. I blog now, and speak and write and teach, while Sabrina runs the company. I work more hours than ever, but it's a different job now and I love it. Nobody reports to me. What a great change. What a relief.

So, happily, things worked out right for me and my company. I love my new job and my company is growing, and the succession move has worked. So that's why I want to share. 

It's scary to give advice about things like this to anybody, so I do so reluctantly. I hope I'm not one of those people who gets lucky and then takes credit for it. 

The tips here come from experience. They are not from academic study. When I was in business school we weren't talking about family businesses. We did have a family business counselor for three years, and she helped us. However, some of these rules contradict what I think is standard wisdom on succession and family business. For example, I think many family business counselors advise against talking business at home. And I think at least some experts on succession would recommend a longer and more explicit and more shared process for succession. But I've talked this over with my wife and several of the five grown-up children involved, and they agree that this is what we'd say, industry wisdom or not. So here's what we come up with.

Tip #1: You will exit eventually. Deal with it.

This is life, not just business. Even if you think you'll never sell your company or go public, you're not going to run it forever. So think about exit strategy, whether you like it or not.

Tip #2: Two parents if possible, not just the one in the business.

This is a moot point of course if you're both doing the same thing, but when it's just one of the two parents doing the business, it's still much better if two parents deal with children's involvement, deciding how and when. In our case it was my business for the first decade but became our business as it grew. Even in the old days, though, when it was just my business, my wife was always in favor of the kids understanding where the money came from. And of course we recognize that you don't always have the luxury of two parents of the same mind. It's a luxury, not a necessity. 

Tip #3: Don't plan your children into your business. It won't work.

They're supposed to do what they want, remember, not what you want? Or are we still in the 19th century (and it didn't work that well then either)?

Trivia contest: name a major movie in which a central character was supposed to go into his or her parents' business but didn't. Answer: lots of right answers. It's an archetype. It goes back to Abraham trashing his father's store in the bible. Jesus was nicer about it, but he didn't end up a carpenter. In Godfather, Don Corleone wanted Michael to be a senator, not the next don, but Michael made that decision, not his father. And for a more recent example, take Hiro in Heroes.

You have to hope they want to get involved, and maybe they will. Freedom to choose is essential. Working in the business has to be their choice, not yours.

Tip #4: Emphasize good education, and let them study what they want.

You want your children studying what interests them, not what interests you or what you think is good for the business.

I'm talking higher education here, of course, not Mrs. Johnson's reading class in the fourth grade. Let them study what they want and let those chips fall where they may. You don't get good education by forcing it, and good education is way more important than the right subject. I hope you think that's obvious.

Despite owning my own business and having my MBA, I encouraged my kids to major in things other than business. They should get an education first, learn business later. It's a trade, not a discipline. Of course I'm biased on this, my first degree was literature, my second one was journalism.

Tip #5: Share what you do. Talk about it. Open up. Tell stories.

My kids had to spend occasional weekend mornings putting sticky Palo Alto Software labels on floppy disks. It didn't hurt them to know where the money (what there was of it in the beginning) came from. My wife and I shared the work. We walked together to the post office when I was starting a newsletter business, checking for new subscribers. The kids came too. None of that hurt.

Tip #6: Let them try things. Make it an attractive option.

We like these people we raised, we're happy to have them involved. Whenever we could we tried to make the workplace a pleasant place to be. This of course means everybody, in our case of a 40-employee company that includes the 37 who aren't our grownup children.

People don't always find their best place right away. Don't push them into corners, let them experiment. Let them work with who they want, on what they want, and eventually they'll end up in a good place.

Ultimately what's at stake here, if things work out right, is you can end up with well educated hard working people who know where the business came from, and why, and want to take it to the best place for its future. That's really a good thing.

Looking back on this, and reviewing my tips, I can see of course that not everything here applies to everybody. Also, that I've probably left some key elements out, although not on purpose.

Furthermore, I'm embarrassed to seem to be recommending against planning. But in this very special case, planning is too much in danger of becoming pushing, as in pushing your children, forcing your dreams down their throats. So you can't really plan on this, you have to just work on making the conditions right, and make it happen.

A Holiday Note

It's late Friday afternoon Dec. 21, and I'm off to Mexico (my country-in-law) early tomorrow morning for a week, with a family group including 11 of us flying together from Oregon and another group that lives in Mexico City.

I do have a post scheduled for Monday, and I may have others later next week, but I may also be doing other things.

I hope that you have a wonderful holiday. Let us all pause for a while, spend time with families if we're lucky enough to have families, and think about all of those things that matter more than business.

Is Your Email Bloggable?

I met Lena West of xynoMedia last week in New York. This was a nice meeting with a smart person who does a couple of really good blogs, Social Media 360 and TechForward. She followed up with an email, and the tag at the bottom of her mail, before the signature, interests me:

That seems like a simple idea, well implemented. It makes perfect sense to differentiate between bloggable stuff and private stuff, and this is an easy way to make that line clear. And I like the fact that it has no legal boilerplate in it; with these things, legal boilerplate doesn't (in my opinion) help anyhow, people honor your request or they don't.

6 Traits of Sticky Ideas

I've recommended the book Made to Stick by Chip and Dan Heath before, on this blog. It's an excellent book. The McKinsey Quarterly has a useful and interesting interview with Chip Heath in the latest issue (registration required, but free).

Chip is the Heath brother who teaches organizational behavior at the Stanford Graduate School of Business.

The interview has a great summary of the 6 basic traits of sticky ideas, the main content of the book. This is in no way a substitute for reading the whole book -- very interesting to read, very entertaining, as well as important -- but I think it will be useful to me in the future as a quick summary reminder of the 6 factors:

Presentation Zen: the Book

If ever there were a message the business world needs, it's better presentations, please. Do a quick Web search and you'll find ample writing by several smart people -- you can start with Seth Godin and Guy Kawasaki -- on how to do presentations better than the "death by PowerPoint" style, also known as boring bullet points.

One of the most visible and most vocal people on this theme is Garr Reynolds, whose blog is Presentation Zen, and whose new book is also Presentation Zen, now available for pre-ordering on Amazon.com.

I'm really looking forward to getting this book. Here I am recommending it before I've even read it. I feel confident making that recommendation because I've been reading that blog and I feel like I understand what  the author is saying.

If you're ever doing slide presentations with PowerPoint or Keynote,  and you haven't had a chance to look  at and think about presentation techniques, then  do yourself and your audience a favor. Take a look at some of these blog posts,  consider this book.

The 'Business As Life' Metaphor

Marriage counseling techniques applied to working with business partners. Choosing investors like choosing a spouse. Building a business is like raising a child (as in The ParentPreneur Edge). Or like coaching a soccer team.

Interesting metaphor, and it seems to work; but is there a surprise there? Did we think building a business wouldn't be a lot like life?

This is from the Nov. 29 New York Times story Like Marriage, Business Takes Work, written by Marci Alboher:

Whether they call themselves coaches, consultants, trainers or therapists, those who work with business partners describe their work in much the same way marriage counselors do. They say that working on a partner relationship goes a long way toward creating a successful business marriage. And while many advisers have been quietly counseling business partners for years, the partners are talking more openly now about the work they do to stay together.

“Partnerships have such high failure rates,” said Kathi Elster, who with Katherine Crowley runs the consulting firm K Squared Enterprises and is co-author of the book, “Working With You Is Killing Me.” “We like to work with them before they go into partnership to make sure they should be doing it. Many people partner because they don’t want to do it alone, and that’s just not a good enough reason.”

And the following is from my June post here, about choosing investors:

It should be obvious, but we focus on getting financed, as if money were the only object. Investors are partners. As with marriage, in which the wrong partners can ruin your life, so too with investors. The wrong partner can ruin your business. That can also ruin your life.

I'm guessing that it's a surprise because we wrap business up in the mystique of business analysis: strategy, focus, differentiation, intellectual property, the value proposition, and on and on. And all of that can be useful in its place, some of it is essential at the core, but it makes it too easy to forget the fundamentals.

Repeat: the business analysis makes it too easy to forget the fundamentals, like giving value to your customers, being fair with your team, communicating well, all of that which we'd call the stuff of life.

A Business Lesson in Six-Year-Old Soccer

Years ago we were coaching a soccer team of six-year-old girls. After a game with a team clearly way more organized and much better coached than ours, I asked the other coach how he did it.

"Oh it's not what we do," he said. "It's what we don't do, and even what we don't say."

He explained that they kept things very simple. 

"We don't tell them about passing or dribbling or very much of anything. We just tell them we want the ball in the goal.

"We don't call them halfbacks or fullbacks or strikers or sweepers. They're kickers and honeybees and goalguarders. Kickers go where the ball is, honeybees go where the ball is going to be, and goalguarders kick it away if it gets close."

And perhaps the most interesting thing of all:

"We never tell them what they did wrong, or what they're doing wrong," he said. "Instead of that, we wait until they do something right, and when they do, we make a really big deal of it. We make sure all the others know what they did right."

This made so much sense that we started copying it immediately. By the following year, the girls had way more fun, the parents had more fun, and the coaches had more fun, and oh, by the way, not that it mattered, but that team also won every game.

Does Web 2.0 Make us Dumber?

Paul Barth has a very interesting post tracking actual neurological research about problems related to multitasking.

Neuroscientists have shown in study after study, that multitasking isn’t helping us be more productive, but in fact, is making us dumber. Are some Web 2.0 tools, with their promise of instant connectivity, notification, and collaboration adding fuel to the fire?

He takes this quickly to the problem of the Blackberry (which in my case I suppose is my iPhone). And it reminds me of the cascading problems of trying to have a conversation with somebody despite the annoying assortment of dings and alerts and reminders and other media. When I sit in my office talking to you on the phone I should presumably be paying attention to you, but if I'm not careful I might also be dealing with instant message threads, looking at email, or the txt that suddenly showed up on my cellphone. It's pretty obvious to me that this isn't good, but Paul's post gives me more evidence and detail:

The Atlantic, November 2007, features an article titled, "The Autumn of the Multitaskers". In the article, author Walter Kirn, discusses the stress we place on our minds and bodies when we attempt too much multi-tasking with Web 2.0 tools, Blackberry’s, IM and more.

For example, Kirn notes that through the use of functional magnetic resonance imaging, scientists have discovered:

“Multitasking messes with our brains in several ways. At the most basic level, the mental balancing acts that it requires—the constant switching and pivoting—energize regions of the brain that specialize in visual processing and physical coordination and simultaneously appear to shortchange some of the higher areas related to memory and learning.”

What really bothers me is that they can actually see it on the scans and in the chemicals.

Sometimes, this pursuit of an “always-on” world translates into ill effects for our bodies. The article continues;

“Certain studies find that multitasking boosts the level of stress related hormones such as cortisol and adrenaline and wears down our systems through biochemical friction—prematurely aging us. In the short term, the confusion, fatigue and chaos merely hamper our ability to focus and analyze, but in the long term they cause (our brain) to atrophy.”

Gulp. Does this sound familiar? And for that matter, congratulations, you managed to get to the end of this post without stopping because of Outlook alerts, IM, or telephone interruptions.