Even first-time CEOs often realize that they should be thinking about strategy. But what is strategy? Strategy is different from vision or tactics, but how? And how should the CEO approach strategy? My current HBR.ORG article helps you understand the entrepreneur’s job description and how an entrepreneur should approach strategy.
Business
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Does a business’s falling stock price matter?
In a recent Facebook discussion, someone shared the notion that BP’s falling stock price would somehow translate into actual distress for the company. Will it?
Here’s how I understand it: The stock market is a secondary market. A company sells stock to the market to raise cash, but once that stock is sold, all future trading of those shares happens between parties unrelated to the business.
The operational cash flow of the business is completely separate. The business’s stock price only affects the business if they need to raise more capital by selling another stock offering.
It’s also true that the Board of Directors may fire the CEO over a low stock price and bring in a new one. But in a company the size of BP, that’s not likely to have any immediate impact on the company’s financial position, whether or not the market boosts share price in response.
It seems to me if BP’s stock price is tanking but the business is operationally strong. If their liability remains capped at $75 million (as it was by Congress), a tanking share price, far from indicating a business in trouble, may be an opportunity to buy shares in a solid, going concern, at a bargain basement price.
Time Management Tips Video by Stever Robbins
This is my Time Management Tips video that I did as part of Harvard Business School Publishing’s Harvard Manage Mentor product, you can see it here.
How to Set Boundaries at Work
A critical part of getting work done is getting the rest of your life done, too! If you aren’t playing, having fun, and enjoying life, you won’t be able to get things done when you need to. You’ll just go through the motions, waiting for a freedom that never arrives.
This week’s Get-it-Done Guy podcast is all about how to set boundaries at work. Listen and enjoy!
The Entrepreneur CEO’s job description
Earlier this week, I began a series of articles on the Harvard Business Review blog site that will deal with the job description of the entrepreneur. The series arose because while people talk a lot about what qualities make up a good entrepreneur, the world is strangely silent on how an entrepreneur should actually spend their time. They always run around like the sky is falling, and they’re busy beyond belief. But doing … what? And how do they know what they’re doing is actually moving the company forward, versus just being whatever activity caught their eye at the moment.
Read my HBR.ORG blog post on Advanced Entrepreneurship: The Entrepreneurial Job Description.
Getting work done on airplanes
Today’s Get-it-Done Guy episode is about choosing how to be productive on airplanes. Most of us just assume that bringing as much work as we can is the way to go. Not necessarily. The airplane environment presents an increasingly rare opportunity to concentrate on certain kinds of task. You can find today’s Get-it-Done Guy episode by clicking the links in this message.
Planning for operational growth
A key element of working less and doing more is preparing enough for the future so you have systems in place when the demands on you grow.
If your business is lucky enough to be on a growth path, you still have to deal with setting up operations before the growth happens. Otherwise, you get caught unable to deliver on the extra sales you’ve generated. If you need examples, look no further than AT&T’s inability to deliver adequate data coverage in major markets since the introduction of the iPhone, five years ago. I was interviewed by Latino Business Review on the preparing for operational growth. It’s interesting that the article characterizes me repeatedly as “conservative” in my business practices. I wouldn’t consider my advice conservative; I’d just call it common sense. If you’re growing into a country or product line you have no experience with, why in the world would you make a huge bet with no data? Far better to make a small bet that lets you collect the data, and then commit major resources.
Read the article here: http://www.latinobusinessreview.com/business-features/operations/think-medium-term-planning-operational-growth
Business has a lot to learn from theater people
We wrapped up Evil Dead: The Musical this weekend. I am sad. I miss rehearsal every night. I miss singing and dancing. I miss wondering if that is water in the makeup, or whether Zach’s drool was a bit too enthusiastic. Part of why I decided to start acting was the suspicion that it would be good for me socially and emotionally. I couldn’t have been more right.
The amazing thing about the experience was how quickly we created a feeling of community, shared goals, and closeness. We were all working together on a project much larger than any of us could possibly have done alone. Most people on the project were under 25 (and many were still in college). No one had any formal training in teamwork or group dynamics. No one was using models from Leadership 101, or Good to Great, or … or, frankly, any of the 80,000 business titles that purport to teach people to work together.
And yet, the production demonstrated teamwork that most businesses would kill to have. How could a student theater group on a shoestring budget with no education or background in training or group process pull this off? It really gives me pause.
Perhaps good teamwork isn’t a matter of training. Perhaps there’s something structural that can produce teamwork, simply by its very nature.
I’m intrigued, and I don’t know the answer. What makes the teamwork “just happen” when flesh-eating zombies are involved, when it takes pushing, shoving, pulling, tearing, and training to do the same thing when soul-eating corporations are involved? What do you think?
Customer service requires substance and style
I had a customer service need today. I called the company, whom we’ll call Canadian Mozy, and got a very nice young man named “Johnny.” He seemed to have a genuine American accent, clearly understood my issue, and was able to respond in complete sentences. That’s a good first start. Sometimes, I call a company and someone with a thick foreign accent answers, introducing himself as “Biff Johnson.” That’s a bad sign, especially if you recognize the accent and know that folks in that culture rarely have names like Biff. When a company’s first instruction to their phone reps is, “lie about your name,” you know you’re in for a real treat.
A lot of companies know that having polite reps who tell the truth makes a good impression. Canadian Mozy certainly understood this.
Johnny listened to my problem and explained, “we used to do what you’re asking for. We see we’ve done it for you several times. But our new policy is that we won’t do it any more.” Interestingly, I was asking for something that had no business implications for Canadian Mozy. It did not require them to spend a penny on my request. It did not expose them to any additional risk, nor did it obligate them to anything in the future. It was free for them to provide, they’d provided it before, and some random mid-level pinheaded bureaucrat decided to retract the policy.
Did I get good service? Johnny provided extremely polite service. He was gracious and dealt with my hissing, booing, and making funny noises into the phone with professional aplomb. But he was powerless to fix the situation.
As a result, I’m pulling tens of thousands of dollars’ worth of business from Canadian Mozy and shifting it to other vendors. Though Canadian Mozy likes to trumpet themselves as a “partner” to the small businessperson, they aren’t. Their reps aren’t allowed to think for themselves, and the managers who set their policies don’t understand a whit about how to evaluate the actual business impact of a policy decision. They eliminated a policy that gave customers great value at no expense to themselves, and never thought about how customers might react.
This brings me to the much misunderstood truth about customer service:
- Good customer service requires good style. Your customer support reps must speak the language of your callers, shouldn’t tell obvious lies, and should be polite, courteous, and trained to deal with irate, irrational customers.
- Good customer service also requires good execution. Your customer support reps must have the training to investigate someone’s problem, and the ability to do something about it, especially when the request is one you’ve honored in the past and which has no downside for you but tremendous upside for your customer.
If you’re missing style or executions, customers get upset. In the language of kindergarten, good support comes down to: be polite and keep your promises.
Good customer service requires substance and style
Good customer service requires more than just nice phone manners.
I had a customer service need today. I called the company, whom we’ll call Canadian Mozy, and got a very nice young man named “Johnny.” He seemed to have a genuine American accent, clearly understood my issue, and was able to respond in complete sentences. That’s a good first start. Sometimes, I call a company and someone with a thick foreign accent answers, introducing himself as “Biff Johnson.” That’s a bad sign, especially if you recognize the accent and know that folks in that culture rarely have names like Biff. When a company’s first instruction to their phone reps is, “lie about your name,” you know you’re in for a real treat.
A lot of companies know that having polite reps who tell the truth makes a good impression. Canadian Mozy certainly understood this.
Johnny listened to my problem and explained, “we used to do what you’re asking for. We see we’ve done it for you several times. But our new policy is that we won’t do it any more.” Interestingly, I was asking for something that had no business implications for Canadian Mozy. It did not require them to spend a penny on my request. It did not expose them to any additional risk, nor did it obligate them to anything in the future. It was free for them to provide, they’d provided it before, and some random mid-level pinheaded bureaucrat decided to retract the policy.
Politeness Wasn’t Enough
Did I get good service? Johnny provided extremely polite service. He was gracious and dealt with my hissing, booing, and making funny noises into the phone with professional aplomb. But he was powerless to fix the situation.
As a result, I’m pulling tens of thousands of dollars’ worth of business from Canadian Mozy and shifting it to other vendors. Though Canadian Mozy likes to trumpet themselves as a “partner” to the small businessperson, they aren’t. Their reps aren’t allowed to think for themselves, and the managers who set their policies don’t understand a whit about how to evaluate the actual business impact of a policy decision. They eliminated a policy that gave customers great value at no expense to themselves, and never thought about how customers might react.
This brings me to the much misunderstood truth about customer service:
- Good customer service requires good style. Your customer support reps must speak the language of your callers, shouldn’t tell obvious lies, and should be polite, courteous, and trained to deal with irate, irrational customers.
- Good customer service also requires good execution. Your customer support reps must have the training to investigate someone’s problem, and the ability to do something about it, especially when the request is one you’ve honored in the past and which has no downside for you but tremendous upside for your customer.
If you’re missing style or executions, customers get upset. In the language of kindergarten, good support comes down to this: be polite and keep your promises.