Five hundred and sixty (560). That is how many commercial Chapter 11 filings occurred in April 2020, a 26% increase from the same time the year prior.
That is 560 data points proving that creating a value proposition is not a one-time deal, unless you want to be left behind as the market shifts and your business changes to meet those new market needs. Just consider the year 2020 as a microcosm for these shifts. The economy, technology, consumers, and nearly every market in every industry have changed significantly in a few short weeks because of the Covid pandemic.
Some of the companies are large brick-and-mortar retailers like J. Crew, Neiman Marcus, and JCPenney. The market had been trending to online sales for quite some time, yet they got complacent and continued with their legacy brick-and-mortar retail strategy. Coronavirus simply accelerated the consumer transition to e-commerce apparel shopping, leaving these iconic stores behind.
Earlier this year…January to be exact…which feels like a different time and a bygone era, I wrote an article on the essentials of the value proposition to tell an epic fundraising story (“Is Your Fundraising Story Epic? Blueprint: How to Open Doors to Funding Starts with the Value Proposition”). The fundamentals to create or reshape the value proposition still apply. After all, your company culture, your product, and, most of all, your why constitute the raw material for the destiny of your company. But how many of the 560 companies who filed for Chapter 11 in April could have avoided bankruptcy proceedings if they revisited their value proposition and evaluated some of the following questions:
What is your “why”?
Why is it your “why”?
Is there still a need for your product or service? What problem does it solve for customers?
Is there a better way to deliver your product or service for today’s market?
Is your product still unique?
Do customers inherently understand what your product is and how it helps them?
Does your value proposition compel your target audience practically AND emotionally?
Can your product or service transcend a crisis?
The numbers tell the story…have you paid attention to your bottom line?
To learn more on how to create a winning value proposition at any company stage or as part of an effective 1-page executive summary and pitch deck, contact me for a complimentary consultation by phone at 314-578-0958 or by email at ilebow@transformationsolutions.pro.
Ines LeBow is the CEO, Transformation Executive for ETS. She is a known catalyst for business operations, bringing 30+ years of hands-on experience. Ines has a long history of being recruited into senior executive roles to improve the execution of business operations and to drive revenue growth. You can see her LinkedIn Profile at www.linkedin.com/in/ineslebow, view the ETS website at www.transformationsolutions.pro, or email her directly at ilebow@transformationsolutions.pro.
This is a Guest blog post by Bei Ma, Founder and CEO of The Pinea Group
Leadership Transformation in 2020
Change is inevitable. Transformation is by conscious choice.
Photo by Evgeni Tcherkasski on Unsplash
As Bill Gates recommended 5 summer books in his recent Gates Notes on May 18, 2020, he wrote: “The Ride of a Lifetime, by Bob Iger. This is one of the best business books I’ve read in several years. Iger does a terrific job explaining what it’s really like to be the CEO of a large company. Whether you’re looking for business insights or just an entertaining read, I think anyone would enjoy his stories about overseeing Disney during one of the most transformative times in its history.”1
Yes, indeed. Robert Iger, in his 2019 book “The Ride of a Lifetime”, shares in great detail on how the ten principles that strike him as necessary to true leadership have transformed Disney. And the ten principles are: Optimism, Courage, Focus, Decisiveness, Curiosity, Fairness, Thoughtfulness, Authenticity, Relentless Pursuit of Perfection, and Integrity.
While each of these ten principles speaks the truth of leadership, we need more, we need more for an unprecedented year we are in at this very moment. The year of 2020 perhaps manifests every aspect you can imagine that life does not always go the way you expect it will.
We are still in the middle of the global pandemic. Period. The director of National Institute of Allergy and Infectious Diseases and the nation’s top infectious disease expert, Dr. Fauci spoke at BIO Digital virtual healthcare conference on June 10 that the coronavirus pandemic has turned out to be his “worst nightmare” and warned that it’s not over yet.2
Millions of people still have no jobs or steady income despite an optimistic labor report of May by the Department of Labor. According to Business Insider, US jobless claims totaled 44 million, meaning more than one in four American workers have lost a job during the pandemic.3
Social reform is well likely underway with the “Black Lives Matter” movement amid nationwide protests. New York Governor, Andrew Cuomo says he intends to sign the package of bills passed by New York legislators for comprehensive police reform.4
In the business context, CEOs have been facing an ultimate leadership test. While business executives shall absolutely continue to incorporate and implement in their daily business life the ten principles of true leadership by Robert Iger: Optimism, Courage, Focus, Decisiveness, Curiosity, Fairness, Thoughtfulness, Authenticity, Relentless Pursuit of Perfection, and Integrity, leadership transformation is imperative. CEOs must make conscious choices for leadership transformation facing one crisis after another in the year of 2020 and onward.
In this article, we explore two actions, accompanying mindset and qualities that can help executives navigate such perfect storms and future crises and consciously make leadership transformation.
Leading with Compassion
Numerous studies show that in a business-as-usual environment, compassionate leaders perform better and foster more loyalty and engagement by their teams.5 However, compassion becomes especially critical during a crisis.6
Four months into the pandemic, the nation is seeing a historic wave of widespread psychological trauma driven by fear, isolation, uncertainty, anger, and distress. Nearly half of Americans report the coronavirus crisis is harming their mental health, according to a Kaiser Family Foundation poll.7
To an organization, collective fears and existential threats triggered by the crises call for a compassionate, empathetic, caring and highly visible leadership. If executives demonstrate that everything is under control with business-as-usual meetings and overconfident emails with an upbeat tone, afraid of showing the genuine vulnerability, empathy to connect and compassion to support their people, reduce their stress and burden, absurdly, this might backfire and will certainly not create the confidence, innovation and creativity from people to enable them navigate through the crises and recover the business.
“I’ve learned that people will forget what you said, people will forget what you did, but people
will never forget how you made them feel.”
– Maya Angelou –
People feel it and will never forget when leaders act with genuine compassion, especially during the crises.
Leading with Rooted Power
In routine emergencies, experience is perhaps the most valuable quality that leaders bring. But in novel, landscape-scale crises, character is of the utmost importance.8 Deliberate calm is the ability to detach from a fraught situation and think clearly about how one will navigate it.9
Crisis-resistant leaders, as the captains of their ships during a perfect storm, will be able to unify the teams with deliberate calm, clarity, and stableness, making a positive difference in people’s lives. The calmness comes from well-grounded individuals who possess rooted power of humility, hope, and tenacity.
Crisis-resistant leaders return to their roots, core values, beliefs, and principles during a perfect storm. They pose questions to themselves and teams about what the organization stands for, what the purpose is, and what should continue to do or stop doing, what need to be created as new practices or ways of working, new norms that are emerging.10
The rooted power of crisis-resistant leaders is originated from physical health providing energy and stamina; mental health providing optimistic and positive view; intellectual health providing acute decisiveness and clarity; and social health providing the trust and transparency.
Only grounded leaders with such rooted power can beat landscape-scale crises.
………………………………..
The crises and overwhelming consequences ask for leadership transformation. Besides the ten principles to true leadership1, business leaders who make conscious transformation: leading with compassion and leading with rooted power, can support their organizations and communities, navigating through the perfect storms.
Jane E. Dutton, Ashley E. Hardin, and Kristina M. Workman, “Compassion at work,” Annual Review Organizational Psychology and Organizational Behavior, Volume 1, Number 1, 2014, pp. 277–304; Jacoba M. Lilius, et al, “Understanding compassion capability,” Human Relations, Volume 64, Number 7, 2011, pp. 873–99; Paquita C. De Zulueta, “Developing Compassionate Leadership in Health Care: An Integrative Review,” Journal of Healthcare Leadership, Volume 8, 2016, pp. 1–10.
Jane E. Dutton, et al, “Leading in times of trauma,” Harvard Business Review, Volume 80, Number 1, 2002, pp. 54–61; Edward H. Powley and Sandy Kristin Piderit, “Tending wounds: Elements of the organizational healing process,” Journal of Applied Behavioral Science, Volume 44, Number 1, 2008, pp. 134–49.
Gemma D’Auria and Aaron De Smet, McKinsey & Company, Organizational Practice, “Leadership in a crisis: Responding to the coronavirus outbreak and future challenges”, 2020.
Helio Fred Garcia, “Effective leadership response to crisis,” Strategy & Leadership, 2006, Volume 34, Number 1, pp. 4–10.
Adapted from Ronald Heifetz, Alexander Grashow, and Marty Linsky, “Leadership in a (permanent) crisis,” Harvard Business Review, July–August 2009, hbr.com
About the Author
Bei Ma is the founder and CEO of the Pinea Group (Pinea). Pinea serves as a trusted partner specialized in cross-border fund raising, market access, clinical studies, regulatory pathway, licensing, and distribution to help medical devices, diagnostics, pharmaceutical and biopharmaceutical organizations to achieve the best patient outcomes and commercial success. Previously, Bei Ma served as Vice President of Global Healthcare Business Development at British Standards Institution (BSI) Group. Bei can be reached at 410.271.7267 and beimalong7@gmail.com; her LinkedIn profile is https://www.linkedin.com/in/beima/
This is a Guest blog post by sales and sales management expert Chris Tully.
How to Hire a Stellar Sales Team to Accelerate Your Recovery
If there is a silver lining to the pandemic-related economic shut down, it is that a lot of excellent salespeople are now available and hungry to contribute to your business. The opportunity here is to rehire your best performers and then build a stronger team than before.
To hire a stellar sales team to accelerate your recovery, you need a plan. Here are some things to consider that will help you create an excellent hiring plan.
1. Are your business goals different than before the shut down?
In the past few months, you’ve had time to really think about your company. You may have revised your strategic business plan and reprioritized your goals. If so, take a look at your new focus and figure out, “what sort of sales power will get me there?”
As an exercise, picture your previous sales team. Imagine how they would – or would not – achieve your new goals, and what sort of salespeople you need going forward.
2. Are you clear about the sales role?
What is it that you really want your ideal salesperson to do day to day, and accomplish overall? What specific skills would that person need? Most importantly, be clear about the personal attributes of the ideal person to represent your business.
3. Are you willing to invest in a professional recruiter?
Sure, LinkedIn Jobs, Indeed, and other free job posts or low-cost ads will get responses. But you and your HR people will spend an inordinate amount of time sifting through a lot of junk to get to the few gems. Unless you’re adding entry-level people, don’t cheap out – invest in a professional recruiter, particularly if you’re looking for experienced sales professionals with a proven track record.
Talent recruiters screen against your hiring profile, verifycandidates’ work history, and validate their self-stated strengths and accomplishments. Recruiters also help you find employed candidates who are not looking for a job but who may be perfect for your business.
4. Do you have your sales incentive structure worked out?
Although it isn’t a jobseeker’s market right now, people are still going to ask how they get paid. That’s completely reasonable. As the job market strengthens, candidates who know their worth are going to hold out for appropriate compensation. In addition to your hiring plan, you’re going to need an incentive plan to attract and retain the caliber of salespeople you expect.
5. What third-party tool are you using to assess candidates?
Third-party assessment tools are a must with hiring decisions. Let’s face it – salespeople are often chameleons. They are trained to probe for needs, listen actively, and position their products (themselves, in this case) in the best possible light to solve your problem.
You need some objectivity to balance those impressions, especially if you don’t hire that many people each year. There has been a lot written about the cost of a bad hire, which I won’t repeat here. Get some help!
These are three salesperson assessment tools that I recommend:
Predictive Index Hiring Assessment (very helpful across multiple professions)
6. Do you have an effective on-boarding process?
It’s important to have a well thought-out plan to get new sales hires acclimated to their role in your company. For that, you need to a road map that new hires can follow (as well as trainers) so nobody gets lost.
7. Can you “hire slow”?
This last question is a trick one: the answer has to be “Yes.” You’ll want to take your time and think about the answers to all of the questions I’ve laid out, in order to hire superb salespeople. It’ll be so worth the time and effort when the right team propels you to reach – and exceed – your goals.
Chris Tully is Founder of SALES GROWTH ADVISORS. He can be reached at (571) 329-4343 and ctully@salesxceleration.com
“For more than 25 years, I’ve led sales organizations in public and private technology companies, with teams as large as 400 people, and significant revenue responsibility.
I founded Sales Growth Advisors to help mid-market CEOs execute proven strategies to accelerate their top line revenue. I have a great appreciation for how hard it is to start and grow a business, and it is gratifying to me to do what I am ‘best at’ to help companies grow faster and more effectively.
Let’s get acquainted. I am certain I can offer you an experienced perspective to help you with your growth strategy.”
This is a Guest blog post from Jeff Cherry, Founder and Managing Partner of The Conscious Venture Fund and Founding Partner of The Laudato Si Startup Challenge. He is a tech CEO and mentor, investor, philanthropist, and community builder.
What comes next?
I recently listened to a thought-provoking episode of the TED Radio Hour on NPR entitled What We Value. Its premise was that this economic and societal crisis in which we find ourselves is accelerating the move towards a new set of values when it comes to the practice of capitalism. Those of us in the social impact and Conscious Capitalism space are heartened to see this discussion gaining momentum, but the question remains: How will capitalism change now that the unhealthy state of business and our major societal institutions have been laid bare?
There are many indications that this shift was in the offing far before the onset of the coronavirus pandemic. Although late to the game, the statement released by the Business Roundtable in August 2019 signaled a transformative move away from the outdated notion of shareholder primacy and towards a more human and effective form of business. It certainly garnered the attention of the press. And others in the business mainstream who had been either unaware or hostile to the market forces driving this change, are now finding it hard to ignore discussions of stakeholder management and whether business should have a broader role in society.
These ever-expanding discussions about the purpose of business in society are now taking place in the context of what does a return to “normal” look like in the economy. And a growing sentiment that the normal we were experiencing — where greed, inequity, declining living standards, crony capitalism, rent-seeking, regulatory capture, share buy-backs, corporate welfare and environmental depletion were the norm — isn’t in fact normal. Nor a state of being for which we should collectively yearn. As you might imagine, I agree.
The challenge we face now then, is how do we actually execute on this new idea? Many people talk about business for good and changing the purpose of the firm. But in the real world of competitive advantage, pricing models, customer needs, shareholder demands, supplier, employee and community relationships, knowing what to do is hard. We speak to entrepreneurs all the time who are philosophically aligned with a new narrative about business. They can cite anecdotes about others who have been successful, and they lack a cognitive frame that they can use to build an organization that embodies this day-in and day-out.
I’ve written at length about why I believe a focus on stakeholders in business and capitalism needs to replace the old story. In this article, the first of a two-part series, I’ll describe a framework to begin the journey to business as an institute of societal well-being: Or Human Capitalism.
The New Narrative of Business in Society: Human Capitalism What does a new story about the practice of business and capitalism look like in practical terms?
In order to fully bring this new narrative to life, I believe we need to re-define the purpose of business as a societal institution. Then, we need to translate that definition into tools that real entrepreneurs and executives can use every day to guide how they formulate strategy, individual decision making and implementation.
When a new cohort of the Conscious Venture Lab convenes, I ask a question to frame the work we’ll be doing over the ensuing 16-weeks: “What kind of world could we create if investors, executives and entrepreneurs cared as much about people as they care about profit?” It isn’t a question I expect any of the teams to answer outright. It’s a rhetorical challenge to think about how these ideas impact their businesses and the broader society.
Over the last few months, I’ve reframed that question: What kind of world could we create if we decided our first duty in business was to simply care for each other? This is the essence of Human Capitalism.
This version of the question doesn’t pit people against profit, which I believe is a false construct. Instead, it captures the meaning we’re all experiencing in this moment: can we be a complete society if the overarching purpose of business is only to increase profits and not primarily to improve the human condition? Both of these questions are variations of the age-old investigation of “What is a business for?” Academics, economists, politicians, social scientists and businesspeople have been asking this question for decades, if not longer.
Liesel Pritzker Simmons, co-founder of the impact investing firm Bluehaven Initiative, has said, “A crisis gives us an excuse to have conviction earlier.” What we are experiencing in this moment has emphasized how interconnected we are as a society and as a world. It has emphasized the importance of health as a public imperative. The importance of economic, community and personal resiliency as interdependent societal imperatives to which individuals and all societal institutions, even businesses, need to contribute. This crisis is bringing along those who may not have reached a level of conviction to move to a more human form of capitalism had things stayed … normal.
In this new reality it’s clear that the question about what type of world we want to create can no longer remain abstract or rhetorical. The coronavirus pandemic has exposed the truth, that a focus on our interdependent well-being is necessary for society’s survival. Succeed together or fail together the choice is ours, but we can no longer hide behind a narrative that separates individual financial self-interest from our mutual survival.
In the post-COVID world, the new narrative of business in society is a narrative about authentic caring, societal resilience and collective well-being.
Practical Ways to Integrate Human Capitalism Herb Kelleher, the legendary founder of Southwest Airlines, once said, “The business of business is people — yesterday, today and forever….” But what does it actually mean to structure your business around people? What can you do tomorrow to transform the structure of your business, respond to this new reality and become the type of leader that society needs?
Caring is Job 1: Above all there is one thing leaders must do first in order to be successful in this new world: They must actually care! To be clear, leaders who embrace the idea of caring for stakeholders as a core value and primary motivation for running a business will be well-positioned to succeed in this new world. They’ll be more able to execute on the ideas described later in this article and more likely to attract talent, customers and investors in a post-COVID world of business as a vital instrument of society.
At first this seems obvious and perhaps, some would say, no different than the status quo. But the nuance of authentically treating employees, suppliers, customers and communities as individuals deserving of your care for their own sake, as opposed to primarily as fodder for creating returns is critically important. Not only to how your company will be perceived, but authentic caring — or the lack thereof — will have a tremendous impact on your competitive performance. People understand instinctively if you are treating them fairly simply as a form of manipulation for other ends. And, unless you’ve created a true culture of caring in your organization, you’ll be tempted to abandon that care when it comes into conflict with your “real goals.” The best leaders however will understand this simple truth: how we think about creating financial value is now, more than ever, clearly tied to the way we create societal value. Authentically caring is a key component of this new narrative.
“What wins in the marketplace is that you are responsible for taking care of everyone who encounters your organization” Tom Gardner: CEO and Co-Founder, The Motley Fool
With that as our foundation, there are two things that every leader can do to build caring into the operational DNA of their business:
First, adopt a specific set of guiding principals about what it means to care for each other in service of societal well-being. And second,
Institute a practical business operating system that provides a framework for living into those guiding principals.
Here in Part-1, I’ll discuss a set of guiding principles we’ve created at the Conscious Venture Lab to help entrepreneurs execute upon these cultures of caring.
Guiding Principles: The Five Promises of Collective Well-Being In order to seed this new culture of caring into the DNA of your operations, it is crucially important that you articulate and codify a set of guiding principles that the entire company can use to organize your thought processes and create operating norms, policies, procedures and metrics that will keep your culture on track in good times and in challenging times…like during a pandemic.
Companies that will lead us into a more effective model of capitalism and a future of broadly-shared prosperity have structured their business to deliver on what I call The Five Promises of Collective Well-Being, through which we vow to use business to make the world:
More just,
More joyous,
More equitable,
More sustainable and
More prosperous for all.
Let’s examine each principle:
Business as a path to a More Just society: Leaders who are best at this will work to create social justice by structuring their organizations to level the playing field and authentically create access to opportunity for all those in their ecosystem who want to contribute.
Conscious Venture Lab and SHIFT Ventures portfolio companies Hungry Harvest and R3 Score have built this promise into their business models, which drives impact and returns.
Hungry Harvest creates a more just world by providing fresh food to communities that wouldn’t otherwise have access to it and dignified work opportunities to people in need. As a result, they create scores of “Harvest Heroes” who loyally buy wholesome food from the company that otherwise would have gone to waste. In the process they have increase sales by more than 34,000% over the last 4 years.
R3Score creates a more just world by providing a dignified return to civil society for millions of formerly incarcerated Americans and allowing banks a way to engage with people they would otherwise ignore. Thereby expanding the banks’ customer base, putting financial assets to work that would otherwise lay fallow and giving the 1-in-3 Americans with a criminal record the opportunity to build a new life.
Business as a path to a More Joyous life: Leaders who bring more joy into the world will do so by focusing on a combination of the quality of the human interactions in their operations, eliminating misery as a core aspect of their business and/or creating products that bring authentic joy to more lives.
One of my personal favorite companies, Union Square Hospitality Group, uses a culture of caring and enlightened hospitality to bring joy to employees, customers and suppliers alike.
Startup Aqus Water, that was a part of the Vatican Laudato Si Challenge in 2017, has created a product that puts “three years of clean water in the palm of (the) hand(s)” of people in places where lack of clean water has been causing extreme hardship for centuries. With more than 780 MM people in the world lacking access to clean water, bringing joy will undoubtedly bring prosperity to many.
Business as a path to More Equitable communities: When leaders focus on creating a mutual exchange of value between all stakeholders, they move their organizations away from the negative consequences of shareholder primacy and create more equitable communities for everyone. Paradoxically, an equitable approach to business, or removing the shareholder blinders, often creates new paths to greater value for shareholders.
Greyston Bakery in Yonkers New York is a pioneer of open hiring. They create a more equitable world by focusing not on the tyranny of weeding people out in the hiring process but by providing the dignity of work to anyone who wants it.
Here in Baltimore, Jacob Hsu and his company Catalyte have created an entirely new way of identifying undervalued individuals who have the aptitude to become exceptional engineers. Creating new paths to equity and unleashing massive financial potential for communities, his clients and the company.
Business as a path to a More Sustainable world: The winning leaders of the new narrative think and plan for the long-term. They understand that sustainability in every sense is the key to enduring organizational health. They establish a circle of growth for the planet, the people who serve or are served by the organization and the organization itself.
Billion-dollar clothing company Patagonia has rejected the world of “fast fashion” by creating high quality, long-lasting products and offering a repair and reuse program to discourage customers from buying things they don’t need.
Business as a path to a More Prosperous existence for us all: The best leaders view value creation with a polarity, or both/and mindset. They actively look to create real wealth for employees, customers, communities, suppliers and shareholders. They work to manage the polarity of creating value for all stakeholders by asking themselves questions like: “How do we simultaneously achieve the upside of paying our employees as much as possible, and, the upside of creating great returns for shareholders?” This is in contrast to shareholder value leaders who see all stakeholder relationships as tradeoffs that need to be solved for the benefit of shareholders.
Starbucks has fed more than 10 million people through its FoodShare program, redoubled its commitment to eliminate gender pay equity gaps, and committed to becoming “… resource positive — storing more carbon than we emit, eliminating waste and providing more clean fresh water than we use …” — all while rewarding shareholders handsomely — even during the coronavirus pandemic.
Why Human CAPITALISM? In Part-2 of this series I will discuss how the tenets of Conscious Capitalism and stakeholder management will allow organizations to clear the clutter and build these principles into everyday operations.
For now, a note before we end to my main audience: The Skeptics:
I spend the majority of every waking hour thinking about how to support entrepreneurs who have previously been neglected and who are creating world changing companies despite the immense hurdles they face. I also spend a majority of that time thinking about how to invest on behalf of my limited partners in a way that will create exceptional returns. I am a capitalist who believes capitalism can and should be practiced in a way that unleashes its power to elevate all humanity. That we can create a more humane form of commerce and human cooperation. What I am suggesting is that capitalism, like any man-made system, must evolve as society evolves. To paraphrase my friend and mentor Ed Freeman, professor at the Darden School at The University of Virginia, the alternative to capitalism as we know it today is not socialism, but a better, more human form of capitalism.
For those who would push back on these ideas as leaving shareholders behind and giving away profits I would simply ask you to suspend disbelief for a bit. Take a few minutes to think not about what you might lose, but about what you might gain. What kind of world could we create if we decided our first duty in business was to care for each other? Look around…I think that time has come.
Jeff Cherry, is CEO and Managing Partner of SHIFT Ventures, and Founder & Executive Director of Conscious Venture Lab, an award-winning and internationally recognized early stage accelerator. He is also Founder and Managing Partner of The Conscious Venture Fund and Founding Partner of The Laudato Si Startup Challenge. Jeff is a pioneer in conscious capitalism and double bottom-line investing. He can be reached at jcherry@consciousventurelab.com.
This is a guest blog post from Shellye Archambeau, humanitarian, author, speaker, tech CEO and Fortune 500 corporate board executive.
“Noel, caring is sharing!” my five-year old granddaughter reprimands her three-year old sister, who doesn’t want to share her toy. It’s a mantra my daughter uses to teach her children. As I witness this exchange while I “shelter in place” with them in Tampa, Florida, it strikes me that the whole world needs to be reminded of this simple concept.
What do we need to share? Compassion. Simply said, demonstrating compassion means to show kindness, caring and a willingness to help others.
Each of us is being affected in very different ways. For some, it is a real inconvenience, but work and life for the most part continue. Our meetings have turned into video conference calls. Our normal support infrastructure has vanished, childcare, school, household help, etc… We aren’t able to gather for celebrations such as weddings, birthdays or a friend’s successful battle against cancer. Worship, gym exercise and self-care routines are being disrupted. Our travel is curtailed. These impacts are a nuisance, but frankly not that hard.
At the other end of the spectrum in addition to the tens of thousands of people battling the virus itself, there are many people out of work or whose businesses are fighting for survival. They are facing real hardship and there are a lot of them: hairdressers, retail and restaurant workers, performers, event planners, housekeepers, etc. The federal reserve reported last year that 40% of Americans don’t have $400 in the bank for emergency expenses. I know the government is also working on stimulus packages for Americans and business owners however the ramifications of now several months without pay will be felt significantly. If we all can take some measure to support, help, comfort and lend the proverbial hand – it will make a difference.
I had the honor of meeting and speaking with the Dalai Lama several years ago. Compassion is one of the key tenets of his teachings.
“Compassion brings inner peace and whatever else is going on, that peace of mind allows us to see the whole picture more clearly.” Dalai Lama
Research backs up the Dalai Lama statement. The Greater Good Science Center at UC Berkeley has conducted research that supports the premise that leading a compassionate lifestyle improves both mental and physical health. “The reason that a compassionate lifestyle leads to greater psychological well-being may be that the act of giving appears to be as pleasurable as the act of receiving, if not more so. A brain-imaging study led by neuroscientists at the National Institutes of Health showed that the “pleasure centers” in the brain—i.e., the parts of the brain that are active when we experience pleasure (like dessert, money, and sex)—are equally active when we observe someone giving money to charity as when we receive money ourselves!”
Now is the time to help where you can. A couple in my Mountain View neighborhood literally started knocking on doors of neighbors who they didn’t know to see if people needed anything. They met several elderly people who indeed needed help with grocery shopping. Another person in my Nextdoor Whisman Station community reached out to offer to talk on the phone with anyone who needs to talk to someone, to rant, combat loneliness or for any reason at all. I’m continuing to pay my housekeeper and my hairdresser for my regularly scheduled appointments even though the services aren’t being provided. Their income is being severely impacted by the necessary Shelter in Place policies.
So, find ways to show your compassion for others during this very challenging time.
This can be done through donations to charities that support the most vulnerable in our society. Such as the American Red Cross who is facing massive blood shortages due to blood drive cancellations, your local food bank, Meals on Wheels who feeds the elderly, No Kid Hungry which deploys funds to ensure that kids don’t go hungry especially with schools being closed, etc.
You can also financially support the Arts or your local businesses. For those not in a position to help financially, you can give the gift of time or effort. For example, there are thousands of people in nursing homes whose families can’t visit. Call one and offer to speak to residents on the phone. Many high-risk people are afraid to go to grocery or drug stores. Offer to do their shopping when you go.
Use your influence as a leader in business, offer free coaching, support, or tools that can be readily provided to help struggling small businesses and entrepreneurs. Not sure how to get started. Check out organizations such as Score.org and businessadvising.org, both of whom provide confidential business advice through a network of volunteer business people.
Now is a time more than ever to be a mentor within your company and community. For example I launched online “Ask Me Anything” live sessions to provide perspectives and support to people working through professional or entrepreneurial issues.
Give your teams the ok to share their concerns, etc.. Sometimes people just need to be heard and know someone cares about them. There’s also a lot to be learned by just listening to the challenges and issues faced by team members.
We are in this together and together we will get through this just as we have overcome past crises. I believe that most of us are compassionate people. Let’s all take at least one action to demonstrate it. As my granddaughter said, “Sharing is caring”.
Shellye Archambeau is a humanitarian, speaker, author, technology company CEO, and Fortune 500 Board member. She is the author of Unapologetically Ambitious and a leading figure in Silicon Valley. She sits on the boards of Verizon, Nordstrom, Roper Technologies, and Okta. She is the former CEO of MetricStream and former President of Blockbuster. Please follow her at http://www.shellyearchambeau.com
Almost 9 years ago, I published this, my first Blog post on WINNING IDEAS. As I work with students, mentees, and other business colleagues of late, I find myself reverting to various “Fundamentals” in our conversations, this one perhaps being the most important of all. Please enjoy and let me know what you think!
What does it take to be Successful? Everyone has an opinion on this for sure.
Success is Winning, and everyone loves Winning.
Having been a student and analyst of the subject of Success for over 40 years, I think I have boiled down the formula of what creates Success:
Each of the great thinkers and each successful person has their own personal take on what it takes to achieve success, but these are the 5 essential elements.
Of course, I left out a couple of other important elements like Serendipity, Luck, Sacrifice, Hard Work, and others, but I believe that these “sub elements” are a part of one of these 5 essential ingredients. For example, if you have a Burning Desire (passion), then you will make the sacrifices and work hard. Goal Setting includes goal review, and is the roadmap to the destination.
Courage is an interesting one and we don’t hear it mentioned often, but to me, Courage is all about taking action, and stepping up and going outside your comfort zone to make things happen. Without Courage, thought cannot easily be transformed into Action.
And what about luck? Well, the more persistent you are, the luckier you get. By never giving up and hanging in there, opportunities will inevitably come your way.
Persistence is my favorite, and I conclude this, my first ever Blog Post with my favorite quote:
“Never give in. Never give in. Never, never, never, never–in nothing, great or small, large or petty–never give in, except to convictions of honor and good sense. Never yield to force. Never yield to the apparently overwhelming might of the enemy.” – Winston Churchill
This is a Guest blog post by Steve Pimpo and Bill Rossello of Greenhouse Consulting.
Common challenges we see and how to overcome them
Most business owners will come to the point in their journey when they feel it’s time to sell the company. They have spent a lot of time successfully building and growing their business, but most times are unprepared for the scrutiny and questions that they will face when being evaluated by a prospective “buyer” and their advisors. Based on our own experience and input we solicited from investment bankers, only about 10% of companies with owners seeking to sell are actually ready. Here are some of the reasons why:
Customer Diversity – A high percentage of company revenue comes from one client or contract. Unless a potential acquiring company is trying to “buy” into a market, buyers like to purchase companies that have a diverse client base or unique service or product offering.
Company Narrative – Some owners use the same sales pitch to pitch to prospective buyers as they do to customers. Communicating the value of a company to a potential buyer is different from selling services to a customer. You need to recognize what buyers want and articulate what is special about your company.
Financials – Sometimes there are accounting inaccuracies that can’t support “quality of earnings” or EBITDA adjustments. You need to ensure that financials are accurate and realistic and can stand up to the scrutiny of a potential buyer’s audit.
Quality of Contracts – Many prime government contracts are “set asides” or subcontracts and there is no clear path to transitioning them to a larger company. You should be prepared with a valid contract revenue waterfall, and a plan to transition set-aside contracts and relationships.
Management Commitment – Ownership hasn’t taken steps to ensure that the leadership and key players are “read in” and will remain with the company post-transaction. People are part of the “goodwill” and company “brand.” It is important to show buyers that there is a plan in place to retain these key employees through to the transaction and beyond.
New Business Pipeline –Buyers will hone right in on your pipeline looking for two things. Is the pipeline full of legitimate prospects and is your pipeline tracking system logical and consistent? If it does not consider reasonable estimates of gross and net revenue and probability of win, it’s not likely to pass a buyer’s sniff test. You need to be ready to justify the reasons you selected each big deal and why you think you have a good chance of winning.
Strategic Growth Plan – Many sellers lack the ability to articulate to potential buyers, a bona fide growth plan, one that paints a credible picture of where the company could go over the next 3-5 years with the power, resources and reach of a larger firm. You need to have that narrative ready to go when you put the company on the market.
Valuation Expectations – Often owners have an unrealistic expectation about the “multiple” of EBITDA or revenue a buyer will pay based on what their peers or friends have received in their transactions. Make sure you focus only on the value of your own business, what similar companies have sold for. Put yourself in the buyer’s shoes. Will they really pay for a tool that does not generate repeatable revenue? Or take a huge risk of paying a high multiple for a company with some of the issues raised herein? Talk to transaction experts and, if you’re willing to pay for it, get a formal valuation prior to putting your company on the market.
Your Near-term Future – Some owners just want to retire or quit the business after the transaction. If you’re the person who manages the company’s client relationships, or you’re the chief technologist, or if there is a major upcoming re-compete, the buyer is likely to want you to stick around for a while after the deal is inked. And there may be an “earn-out” provision that ties some portion of your proceeds to achieving certain objectives over that timeframe. Before you put the company on the market, be sure to consider how you would answer a buyer if they ask you stay on.
Due Diligence Preparation – There needs to be sufficient organization and appetite toward due diligence. The process is inevitably painful, invasive and underestimated. Approach this as a client engagement or actual project and assign one individual to own/manage responsiveness and production.
Without question, selling your company will be the most important professional decision you will ever make. If you address these issues prior to formally starting the process, you will get more attention from investment bankers, dramatically increase the probability of a successful transaction, and likely increase your proceeds too. Most investment bankers don’t have the time or resources to help you address most of the things we have identified. Even worse, they might see you as an unsophisticated seller and probably turn down your business. So, commit the time, effort and resources to prepare 12-24 months before you call the bankers.
Steve Pimpo and Bill Rossello are Principals and co-founders of Greenhouse Consulting, a Washington, DC based business that provides management consulting services to help companies grow or prepare to sell. They can be reached at spimpo@greenhousefirm.com and brossello@greenhousefirm.com, respectively.
This is a Guest blog post from Ling Zhang, Senior Manager at Dixon Hughes Goodman LLP. She covers a lot information which is extremely valuable for small businesses.
“Cash is King” for businesses, especially when they are drifting in the rough currents due to COVID-19. What can technology, services, and life science companies do to survive the challenges and thrive through oppotunities in the current economic conditions? Here are a few considerations for innovative companies to manage cash flow since the pandemic’s inception.
Utilizing the CARES Act and New Laws and Legislation
Businesses have been following new legislation closely and, when possible, taking advantage of cash flow assistance from the federal government to increase liquidity. The following is a list of programs created by the CARES Act that support small businesses:
1. Paycheck Protection Program
As part of the Coronavirus Aid, Relief, and Economic Security (CARES) Act, Congress had appropriated $349 billion for the Paycheck Protection Program (PPP), providing loans of up to $10 million to certain qualified small businesses, and also offering forgiveness for
all or a portion of the loan. As the first round of PPP funding has been utilized, a new funding package has been approved for the PPP for $480 billion, which appropriated an additional $320 billion for the PPP.
The new funding package, passed on April 24, 2020, also includes $60 billion for the Disaster Loans Program and Emergency EIDL Grants.
2. Small Business Debt Relief Program
This program will provide non-disaster Small Business Administration (SBA) loans, specifically 7(a), 504 and microloans not made under the PPP. Under this program, all payments on these SBA loans, including principal, interest and fees, are covered by SBA for six months.
The program provides loans up to $2 million and emergency advances up to $10,000 that are not required to be repaid.
The CARES Act also has the following tax provisions available:
1. Employee Retention Credit
A refundable payroll tax credit for up to 50 percent of wages paid to certain employees is available to eligible employers during the COVID-19 crisis through Dec. 31, 2020. This credit is not available to employers receiving
2. Delay Payment of Payroll Taxes
Taxpayers can defer paying the employer portion of certain payroll taxes during the period beginning on the Act’s date of enactment and ending on Dec. 31, 2020. Half of the deferred amount is due on Dec. 31, 2021, and the other half is due on Dec. 31, 2022. For PPP loan recipients, the Internal Revenue Service (IRS) FAQs1 clarify that taxpayers may defer the employer portion of Social Security on wages paid between March 27, 2020, and the date which the lender issues a confirmation of loan forgiveness for the recipients’ PPP loan.
3. Other Tax Provisions to Accelerate Cash
Other tax provisions include correction of Qualified Improvement Property depreciation; use of excess business loss and Net Operating Losses; and use of Corporate AMT Credits. Consulting with a tax professional may help increase cash flows through maximizing tax refunds and tax planning for the business. Please reach out to your tax advisor to evaluate possible solutions as these may be complex decisions.
4. Main Street Lending Program to Provide Liquidity to Small and Mid-Size Businesses
These four-year term loans are for companies that have less than 15,000 employees and $5 billion in revenue and have a minimum loan size of $1 million. The loans are generally available even if you have received a PPP loan and there is currently no indication of “affiliation” rules that disallowed many private equity portfolio companies from eligibility for the PPP loans. The loan size is generally based on a multiple of 2019 earnings before interest, taxes, depreciation and amortization (EBITDA), which can be adjusted as permitted by lending institutions, and includes existing debt.
The Families First Coronavirus Response Act (FFCRA) also provides refundable tax credit as follows:
Eligible employers are entitled to refundable tax credits for qualified leave wages that are paid, during the period beginning April 1, 2020 and ending Dec. 31, 2020, for specified reasons related to COVID-19 under the FFCRA.
Federal and state governments are continuing to evaluate
additional assistance to businesses.
Turning Challenges into Opportunities
Many leaders of technology, life sciences and service companies, including technology giants and small businesses, have pivoted during the pandemic in different ways by identifying opportunities, and taking immediate action to generate cash to secure a future for their employees while contributing, in their own unique way, to find a vaccine.
Examples include life sciences and medical device companies developing and selling antibody or COVID-19 testing kits; tech manufacturers making ventilators; SaaS software companies offering free HR applications to help manage the health and safety of employees; cyber security information technology services companies developing tracing technologies and providing services to help mitigate cyber security and privacy risks of work-from-home arrangements; services firms providing assistance on the interpretation of new legislation; and more.
Managing Cash Flows
Tech and life sciences companies should also assess key performance indicators (KPI), monitor budget versus actual analyses more closely and frequently, and deploy a plan to manage cash flows through the pandemic and beyond. Companies can consider the following areas to manage internal cash flows in response to the current environment:
1. Accelerate accounts receivable collections through active collection efforts and/or evaluating new technologies to allow customers new payment methodologies;
2. Manage vendors by initiating dialogue and negotiations with extended or delayed payment terms;
3. Classify expenses by variable versus fixed, and consider plans to cut spending on variable expenses where possible. Seek concessions on fixed expenses such as rent abatements, delay in payments, or extended payment terms;
4. Evaluate plans to reduce salary expenses including furloughs, salary reductions, and/or a reduction in force;
5. Seek additional financing opportunities through loans or use of availability on lines of credit;
6. Revise and develop new cash flow forecasts from operations for various scenarios – three-to-six months or even longer if necessary.
As a Senior Manager in the DHG Technology practice, Ling Zhang works closely with client management and C-suite executives to provide audit, financial accounting advisory, and risk advisory services to multi-national publicly-traded corporations and private companies with revenues ranging from $10 million to $50 billion. She advises clients on SEC filings, complex debt and equity transactions, merger and acquisition, new accounting guidance implementation, internal control system design and implementation, and financial statements reporting and disclosures. She can be reached at ling.zhang@dhg.com.
We use various forms of communication to inform, entertain or influence. Depending on intent and circumstance, we may use various technologies to send and receive. Voice, gestures, hand signs, smoke signals, radio, email. The availability of technology offers new ways to communicate that are offered as improvements in speed, cost and convenience. However, while the purpose of communication remains, new transmission mechanisms often alter effectiveness and outcomes.
Specifically, the advent of email, text and video formats have disrupted communication from bi- or multilateral to a one-way broadcast. Expectation of a reply is no longer assumed, expected or, in many cases, even desired. I want to say what I have to say to not just a specific person, but to anyone who will listen — or at least receive my message.
Communication Protocols
Just as standards make processes and products more efficient, communication protocols make communication more effective. Protocols exist in almost every industry and profession. They evolve over time to improve transactions.
But protocols don’t just involve technical, mechanical matters. They have to be used by everyone in the system. This means people have to appreciate their usefulness and use them. Just as Hyper Text Transfer Protocol (http) exists to facilitate standardized and efficient Internet communication, so too do social protocols facilitate interpersonal communication. If someone tried to set up a new Internet protocol, it would take time and effort to get people to adopt it, if they ever did. Similarly, using varying social and communication protocols would hinder, in some cases cripple, communication.
Argumentation is defined as the search for the truth (although the term has been somewhat corrupted lately to mean being disagreeable). Effective argumentation includes what is known as the burden of evidence (support what you say with presumably unassailable facts) and the burden of rejoinder (elevate the discussion when presented with facts by another).
This is what is being violated regularly, unwittingly at first and now possibly intentionally. It seems that social media only warrants a statement, unsupported by evidence when challenged, of one’s opinion. When challenged, the response is to attack, deflect or ignore. While not all discussions follow this pattern, one could draw the conclusion that social media is not a place to explore the truth. Argumentation has just become argument.
This is not miscommunication, where people do partially or wholly miss the meaning or intent of the message. This is more fundamental. It is the lack of desire by the sender for the recipient to respond. It is the lack of intent to participate as much as it is to send. How many people have asked to see a picture of what you had for breakfast? Are you expecting to engage in a dialog about it or are you just “letting people know?”
Dancing
For purposes of this conversation, dancing refers to ballroom dancing. Two people are a team. Their activity requires cooperation and mutual intent.
They send messages through their eyes, voice and gentle pressure on hand, shoulder and back. Two well practiced partners (and they are called “partners” for a reason) move as one, each seeking to anticipate and respond to the other, in the interest of mutual understanding and enjoyment. Even a mishap can be accommodated easily by an attendant partner. The combination of two (or many) can be entertaining and inspiring.
Boxing
Boxing is a contest between two adversaries, opponents, a challenger and a champ. The expectation of all who participate in, and observe, the contest is that one will win and the other will lose. Each has developed a plan to overwhelm the other. They trade punches with the desire that each punch will end the fight. Once the “knockout” has been delivered, the contest is over.
With such ease do we send a text, post a video or send a Tweet. We don’t even have to know who will receive our message, when they will get it or even if they will respond. And we are OK with this.
Can We Teach Boxers to Dance?
It has become easy to send a message without expecting a reply because we expect to be removed from an immediate social response. Without facial cues or body language, or immediate verbal/written response, there is no feedback that could effectively elevate the conversation.
We issue opinion, compliments or vitriol, sometimes not even knowing how our words will be received. Because of this disconnect, we often forget that we may have started a conversation. A conversation that might as easily be received as an invitation to argumentation as a sucker punch.
There is a difference between talking to an individual and to a crowd. Part of our challenge is to know the difference requirements in how we talk to each.
Another part is recognizing that our responsibility in a conversation is to assure our message is received as we intended, and that the conversation is beneficial to all parties.
I’d much rather interact with Fred Astaire or Ginger Rogers on the dance floor (if they’d have me) than Muhammad Ali in the boxing ring. I’d also rather have a deeper and insightful conversation than lobbing, or receiving, insults.
Let’s all learn to dance better.
Mark Haas helps boards and executives create powerful strategies to help them make decisions with greater confidence, impact and pride. He helps companies and nonprofits develop strategies, create and validate business models, and execute with discipline. Mark is also an international trainer, facilitator and speaker in ethics, strategy and performance management.
About 18 months ago, I was cold called by a young, ambitious MBA student who wanted some advice and guidance on something very very difficult to do: breaking into the venture capital business. Relative to huge demand, there are very few entry level VC positions available in the Washington, DC region.
Since his initial cold call, I have met him a few times at various events around town. I had not heard from him in several months until today when, in response to an email announcement my company sent out, he responded that he was still seeking my help in landing a VC job.
I emailed him my response:
Here’s how I may help, with some (free) advice:
YOU have to HELP you. The buck stops with you!
You have to create true value for your customers and constituents (boss, coworkers, investors, friends, etc).
You must give 110% every single hour of every single day, and MAKE SURE all of this is recognized.
Network like a machine. You should be out every night going to 2-3 events per, and genuinely HELPING others – Thats how you build YOUR brand!
Work 80 hours per week. There’s no substitute for hard work.
In this market, the ideal job does not come to you. YOU have to attack and make it happen. And the tools you need are contacts, credibility and expertise, all of which you will develop by following the advice above.
Pursue your dream and never give up!! It may take a month, year, or 10 years, but the persistent person ALWAYS wins…eventually!!
All the best, Tien
That’s advice I would give to my kids, the students I work with at Georgetown or Maryland, and anyone looking to land any kind of job, especially a high-demand job.
Bottom line: you have to help yourself, and there are no shortcuts. Buckle up because the road will be long and bumpy,
WINNING IDEAS - Tien Wong's Blog 