I get why we might be picky in “normal” employment times. Yet I wonder if we are missing the boat on some better staffing alternatives when it comes to putting winners on our teams as the economy continues to improve. And if we are hiring to success factors for the position, there is no reason to screen out candidates ahead of time. It shouldn’t matter if someone is presently employed, recently let go, or in the case of this past recession, out of work for awhile. If they can demonstrate being able to perform to our success factors and fit the culture of our companies, then they should be considered for the position. Same is true of the entry level college graduate, right?

I see lots of folks in transition who are referred to me through my professional network. For most of these folks, it’s simply a connection relationship. For some, it winds up being a coaching situation. In all these cases I see more of a willingness to consider being part of the “Free Agent Nation” to use the title of Daniel Pink’s 2001 book. Commensurate with that trend, I see more companies willing to hire people as contractors for a period of time to determine if the person can actually deliver on success factors. In the case of students, I see more willing to “intern,” or engage in a consulting capacity as well.

Business leaders have several opportunities here. First is to make sure we are doing what we now need to do to make sure we retain our top talent. As the economy improves we are seeing more folks quitting their jobs and moving on to new assignments, and as I said, your folks are being targeted first by those looking to hire. Next is to seriously look at being selective in hiring the right people and get them on the buss. In my opinion, the way to go about that is to develop strong success factors for the position you wish to fill and screen candidates to those factors. Another opportunity is to consider using contractors for some of the more autonomous positions. Of course you want to make sure you comply with all the employment rules and regulations regarding Independent Contractors. The state is coming down hard on those who are trying to escape employee taxes.

However you go about this, I would encourage flexibility and caution. If the economic forecasts I see are correct, then we will be in for another downturn in the economy (certainly not as bad as this last one) beginning around the second half of 2013 and coming out in the end of 2014 or so. That means making sure we are ready for that eventuality by controlling cost and lining up our cash sources again. This makes exploring using contract employees that much more attractive in the short term. This is an opportunity for many of us as the economy reaches an inflection point.

In summary then; On the individual side, I see more folks willing to retrain themselves to improve their skill sets. I also see many people deciding that since they will be looking for a new employment every 24 to 36 months anyway (that seems to be the average,) they might as well become independent contractors. I see students going back to school and waiting out the employment market. I see companies getting new talent on board as they re-engineer their product and/or service offerings.

The short answer is yes CSR matters and no it isn’t enought to just employ people and earn a profit; and it never really has been otherwise. The truth is that now there is more transparency (like it or not) around what companies and business owners are doing. And there is obviously much discontent over the widening gap between the “haves” and the “have nots” or, if you will, between the 1% and the 99% to use the now quite ubiquitous rallying cry of the Occupy Wall Street Crowd.

I’ve noticed an increase in the number of business speakers who are “pitching” employee engagement as a critical discipline for the coming year. Why? Well, for one thing, as the economy improves, we will need to do more to keep our key employees. If you’ve had to cut back on wages, bonuses and benefits, you may want to do whatever you can to restore those wages, bonuses and benefits. If we are not able to do that for profitability and cash flow reasons, then we will need to find other ways to encourage employee involvement in our enterprise. Green Research found that 80% of major corporations are planning to invest significantly in employee engagement in 2012. According to Gallup, 86% of engaged employees say they feel happy at work compared to only 11% of those employees who feel disengaged. So what does this all mean to the company? Companies with high levels of employee engagement saw increases in their bottom line. Towers Watson calculated improvements on average of 19.2% for engaged organizations and a decline in bottom line results of almost 33% for those companies scoring in the lower levels of employee engagement.

One of the ways employees feel engaged is if they are allowed to volunteer their time for causes they support. Many companies are finding ways to support their employees by giving them time, or allowing them to “earn” time that they can volunteer for an appropriate charity organization. Some companies are even exploring the idea of partnering with a not for profit organization and giving their employees an opportunity to volunteer, raise funds, etc. The Social Enterprise movement is pairing for profit businesses with not for profit businesses so that there is a cross-learning opportunity. The not for profit organization may have some great ideas for employee engagement since they spend much of their time getting volunteers energized around a mission. The for profit company can share best practices for containing costs, continuous improvement of processes and managing the paid staff properly. It is a win-win situation in most cases.

As social media continues to grow (businesses are finding the new Google+ to be a great platform) and mature, businesses are finding that they have no choice but to be catering to their customers who often use these platforms almost exclusively. These tools are also used by the consumer to determine the quality of the vendor they are considering. They look for referrals and/or ranking by their friends. They do not believe paid advertisements. Companies have to be involved with the social media sites if for no other reason than to know what is being said about their brands and to know what is going on in their community. The social responsibility part of all this is to make sure that the company is engaged in the community.

The National Association of Corporate Directors sent out a Public Company Governance Survey and found that the highest priority at 72% of the respondents was strategic planning and oversight while only 2% put CSR at the top of their priorities. This suggests that many boards will be working to catch up to their more nimble and media savvy competitors. If the trends in transparency, CSR and employee engagement continues, then we will soon find that “good business” is not only the norm, but a requirement to compete.

Harvard Business School defined entreprenuer this way: “Entrepreneurship is the pursuit of opportunity without regard to resources currently controlled.”- Howard Stevenson

I was reminded of this several times this past month. First, over on LinkedIn, one of the groups I frequent posted this great article from Inc. Magazine. It’s an interesting read.

Entrepreneurship is creating something out of nothing. And of course there has to be a fair amount of leadership quality in the entrepreneur, at least in the beginning. Besides this article, I was reminded of the “entrepreneurship puzzle” as I worked with a colleague on his business idea presentation for his peer advisory board. That, in turn reminded me of the success gained by one of my UCI mentees in starting his own business. These two gentlemen are very different in training and background. Yet they both have the desire and the drive to build their own businesses – “without regard to resources currently controlled.”

The sometimes puzzling thing about those entrepreneurs who jump into things – like young kids jumping into the summer swimming hole without first looking to see what is there – is what motivates them to do so in the first place. And as Eric Schurenberg mentions in his Inc. Magazine article, Stevenson stated that “The entrepreneurs I know are all different types. They’re as likely to be wallflowers as to be the wild man of Borneo.” I agree. The personalities of the business founders with whom I work are very different. And their reasons for jumping into the entrepreneurship swimming hole varies as much as their personalities. Yet one thing seems to be common – they have an idea for a product or service and they are willing to “do what it takes” to get that idea off the ground and into the marketplace. They don’t seek risk, but are willing to evaluate, mitigate and live with the risk. And some pretty much do jump into the swimming hole without looking – though that is by no means a requirement for success; or failure. A solid well thought out business plan is always useful when properly understood and implemented.

In this political season, there is much talk about the particular brand of capitalism in the U.S. Who creates jobs? Is it the small businesses and start-ups or the more established firms? Who are the “good guys?” Captains of industry with their out sized compensation or the entrepreneur earning less than his/her key employees? As usual, there are lots of numbers being quoted to make points on all sides of this argument - an argument which I think is pretty much a moot point. History does not support business being stagnant with the existing players being the only players moving forward. Someone will start new businesses with disruptive technology and the business scene will again shift to create new opportunities for many – including employment. The question will always remain, in my view, How will the workforce evolve to match the new requirements for employment? Who will start the next “big thing?”

One can imagine that entrepreneurship itself will begin to fill the gap on how we as individuals can continue to grow our knowledge and skill set through new an innovative ways of learning. All of this will, of course, continue to be painful and we will have the usual suspects claiming that all businesses eventually become corrupt and those who claim the only way to save our economy is to completely turn the business community loose, without constraint. And as always, the truth will be in the middle somewhere. My sense of things is that we almost have it right today. If we keep entrepreneurs in mind as we formulate policies and regulations so that many new businesses can start and fail and flourish, then we will hopefully have the boiling up of change and new services that we need for a vibrant economy. If we continue to learn from the companies who game the system and plug the holes in regulations, then we will avoid some of the excesses creating havoc now and in the future.

The goal is to restore and maintain the consumer’s confidence that there is a level playing field for them and that someone “has their back” when it comes to “fighting” large corporations. The Occupy Wall Street movement is sending a strong message to the captains of industry and politicians alike – they perceive that the playing field is no longer level. The vast “middle class” is finding their stagnated purchasing power and stunted upward mobility is no longer acceptable. We need to remind ourselves that it makes no difference what we might think, as long as the perception is what it is, then that is the reality for a large number of people. We ignore it at our own peril.

So what are we doing to re-think our approach to the business climate? Will the old models and political party dogmas solve today’s problems? I think not. What if we decided that despite economies of scale we better serve people if we make sure most companies remain “small.” I’m not suggesting government mandate this, but rather that businesses change their models on their own. What if those businesses who might need to be large – telecommunications? Power generation? – found a way to truly serve individual customers as though they really mattered, and found a way to more reasonable executive compensation? Perhaps changes along those lines would go a long way to obviate the need for revolution of the people or intervention by the government. Too much to hope for, I suppose. But then, we could be the change we want to see in the business world and it is the small business, the entrepreneur that is best equip to make the necessary adjustments. That’s a grand idea!

Once you decide, when on the savanna or in the city jungle, that there is danger and you take action, that certainty is very useful. In our personal lives and in our business lives, that certainty locks us in, closes our minds, and keeps us in a box. The thing that is important to understand here is that we reach this “certainty” prematurely, before all the facts are in and considered. Ted Cadsby, corporate director, principal of TRC Consulting, calls this a “speed-accuracy tradeoff” that is no longer necessary. He says that, “. . . there is an antidote to premature certainty: Adopting a mindset of ‘provisional truth.’ ”

What “provisional truth” means is, simply put, we must think of our explanations of how things are as hypotheses, or theories which we always try to disprove. We have to look for evidence that our hypothesis or theory doesn’t “hold water” in a given situation and is therefore incomplete or perhaps even just wrong. This concept is important and we may be able to understand it at an intellectual level, yet when it comes to being skeptical of our own conclusions, assumptions and certainty, we seem to have blind spots. I know I do. And since my awareness has been raised, I am noticing this same “Neanderthal Certainty” in my fellow travelers. It takes mighty effort on my part to not only be skeptical of my own certitude but to suspend judgment for those who (it’s now so obvious to me) are trapped in their own certainty. Once we believe we have figured something out, we want it to be done. Yet, in our very high-speed and complex world, we more than ever need to embrace provisional truth.

This is not new thought in the sense that we have pretty much always expected our scientists to have skeptical, provisional truths. We want them to continue to find out how well their “theories” actually describe the material world. Yet we seem to often eschew that same method, that skeptic’s model, for ourselves and our businesses. The jump to certainty feels natural and good for us. We don’t often stop to think about this unless someone or something makes us do so.

I have often been that person who states what in reality is an opinion with such certitude that an inexperienced person would take what was said as irrefutable fact. I don’t do this on purpose. It happens because I study something that is complex and boil it down to what I think “the answer” is to “what is so” and then embrace that certainty. It’s a relief to be certain. I don’t have to deal with the “lost feeling,” or the “fear of the unknown” if I just make myself certain about the way things are.  Worse yet, it then becomes hard (impossible?) for me to see the evidence that points to there perhaps being a more complete answer or even a better answer. When I believe it I will see it – whether it’s there or not!

There are several good books that I’ve been reading to help me along with these thoughts. Brain Rules, by John Medina, The Believing Brain by Michael Shermer and Brain Bugs by Dean Buonomano. What these and other books, articles and documentaries has shown me is that truly there is no other way to make sure I continue to grow and learn than to recognize that my experience of the world is through the faulty set of senses and meaning making machinery of my brain. Socrates laid this out for us a long time ago: “The unexamined life is not worth living.” And what we now know is that when we let the brain lock itself down with certainty rather than provisional truths, then we cease to continue examining life, learning new things, seeing the material world in new more insightful ways and approaching other humans with the attitude of “I will learn from every person I meet.”

I hope I am no longer the person you meet who seems to be certain that they know the way things are. I am working to embrace the uncertainty and mystery, to live with provisional truths. I will take what I can for verified models of what is so and build on them with the understanding that they might not be perfect and could be refined. I will remember that when we were struggling for survival back thousands of years ago, an uncertain Neanderthal was a dead Neanderthal. But that today, a homo sapiens who practices certitude is a close minded homo sapiens and while s/he may not literally die from this condition will likely live an unexamined  life and s/he may make poor decisions. I get that such a life is not worth living. I also get that personally, I will not be anywhere near perfect in keeping my resolve to live with uncertainty in the big things. I will falter and slip into  the comfort zone of certainty when I shouldn’t. As long as I catch myself (or you catch me!), I will be fine. Of that I’m well, almost certain!

As we furthered the conversation, it seemed that we are actually seeing pretty much the same trends. Business in general (it’s certainly different for each business depending on size, industry, etc.) is sitting on a fair amount of cash that has been accumulating over the last several years. Lack of confidence in the economy means that folks would naturally save in order to be sure survival has maximum opportunity – cash is king! At some point, however, maintenance, improvements, capital equipment, new software and implementing business process improvements can no longer be deferred. What my colleague and I are seeing is that some folks are finally “pulling the trigger” on projects that improve productivity and reduces costs.

There was no discussion that business is picking up for his customer’s customers. That is, demand is not growing (or shrinking for that matter), but is holding steady. Yet to stay competitive, keep a reasonable margin, the whole supply chain is having to reduce costs and one way to do that is investing in infrastructure and improved business processes. Luckily, my colleague is in that very business, so he gains from this slow growing trend of putting in that investment.

Where are consumers in this picture? I think, on a small scale, they are doing exactly as small and medium sized business are doing. The consumer is fixing the things in their homes they need to fix. They are repairing cars rather than simply going out to purchase a new one. They are paying down debt. They are investing in a child’s education where they can afford to do so.

Where are you and/or your business in the supply chain? Do you know what your customer’s customer needs? What will you do to be ready if demand for your product or service is going to be at this low level for the foreseeable future? Or, if demand picks up, are your operations ready to handle the load? Did you let too many employees go to ramp up? Should you hire full time or part time employees? Are there new opportunities for you to fill a need? Assuming we continue to “bump along the bottom” in economic terms, how will you structure your business to survive and thrive?

Lots of questions and very few answers. But then, that’s part of what leadership is about. Knowing which questions to ask, developing a compelling vision for the future and enrolling others in that vision is what makes you a great leader. So how will you get from where we are right now to developing that new vision? Who will help you develop that vision and who will you enroll? This is definitely the right time to re-invent yourself and your company. It is a matter of survival for some!

And then there’s the sun. We haven’t paid too much attention to it until lately. But now, we are learning a great deal thanks to the many orbiting satellites we put around it to study as much as we can about the life of the sun. And that causes us to “connect some dots” with the effects here on earth. Did you know, for example, that you get more vitamin D into your body from 10 minutes in the sun than you would get drinking 200 glasses of milk? That’s a good thing, right? Well, yes except for skin cancer, so now we shoo our kids out of the sun or slather them with cream to block out the harmful rays which also blocks out the vitamin D. But the sun doesn’t really care what we do, and neither does the universe.

The Sun's Heartbeat

Did you know that the sun has cycles? Yes, it has a regular cycle, that scientists have been following for more than 250 years. The cycle is 11 years long. And those cycles have (until now) dominated the earth’s weather patterns. Well, to be precise, there are four factors that dictate our earthly weather: 1. Our own atmosphere, 2. the Sun, 3. El Nino cycles and 4. Volcanic activity. Scientists have figured out the model using all four factors and have very accurately accounted for our weather patterns. Luckily, the sun has been very quiet as we built carbons in the atmosphere, thus giving us a bit of a break in global warming. The question is what about the next cycle? If it is a normal peak, we will see the warmest temperatures ever recorded by man. If it is a “wimpy peak,” we will get a continued break in the global temperatures. One way or the other, neither the sun nor the universe cares about our comfort.

Finally, here’s a bit of information that really stopped me in my tracks (literally, I stopped running so I could go back and listen again). Science has proven that life has been on the earth for about 4 billion years. The sun should be relatively unchanged for another 5 billion years or so. However, the sun also increases its temperature by 10% every billion years or so and has ever since it was born. That means that in about another billion years, even without making any drastic changes, it will increase the temperature on the surface of the earth to about 700 degrees F. Life as we know it, and perhaps all life period, will no longer exist. That means life on earth has lived out about 80% of its allotted time – assuming we humans don’t kill ourselves in some other fashion first or speed up this demise by continuing our irresponsible activities. All of a sudden, the business and life “problems” I deal with seem pretty puny. So, as I said, the universe is indifferent and knowable. Sometimes the knowing gives comfort and insight into life here on earth. Sometimes the knowledge gained isn’t all that comforting. But it does help to put things in perspective!

But having gained knowledge – whether about our universe or ourselves or our social/business situation – is only the beginning. We need the wisdom to act according to that knowledge and our best guess about how we might “shape the future.” To bring my favorite saying down to earth, “nature is indifferent and knowable.” The earth doesn’t care if we make it – and may, if anything, have a tendency to want to see us gone because we are very disruptive. And when it comes to our businesses, “the markets are indifferent and knowable.” And competitors may have a tendency to want to see us gone.

While the politicians in Washington DC played their silly games with the debt ceiling – perhaps permanently destroying faith in the American experiment or at least our credit ratings – the markets did what markets do without regard to what we might want. Link the shenanigans in DC with the global debt crisis and you have the perfect storm for a very permanent and painful change in our business models. It remains to be seen what the citizens of the world decide to do with their respective governments and economic systems. Yet, we as individuals can hardly just sit around and wait to see what transpires. Complaining won’t help. Screaming obscenities at the TV won’t help although that does seem to make one feel better! So what should we do?

I’m going to suggest that we take a hint from our scientists. First, I’m going to do my best to find out what’s so. I’ll use data, observations, experiments and see if I can understand at least a little bit better this complex, interdependent economic system we’ve set up. We can’t go back, so we have to figure out how to go forward. I’ll build a theory and see how that works first to explain what I’m observing now and then to give me some hints about how to chart a course to the goals I set.

So far, here’s what I think is so:

• The economic models of the past are no longer working to predict our markets
• Consumer activity will be generally less than it has been
• Industrialized countries will experience the most pain as they adjust to de-leveraging/deflation
• Lower levels of growth are in for most developed countries
• Developing countries will require skill at not letting their economies become over leveraged
• Countries no longer have time, resources or the need to fight wars (but some will be stupid and engage anyway despite the broken model!)

There are, of course a whole bunch of other major things to add to the list, such as demographics, technology advances, etc. This list is one that addresses the complaints or statements I hear about “getting back to normal.” From what I can see – ain’t gonna happen!

Despite this list, I am optimistic that we will actually figure this all out, and more people will be living better lives in many countries than are now enjoying such a life. The pain will be the adjustment for those who have enjoyed privileged places up to now. Don’t get me wrong on this, I’m not saying America’s best days are behind her. Not at all. I am saying it’s not at all unlike what happens in individual countries as technology “kills” one industry displacing workers who have to either re-invent themselves or slip into poverty and despair. Some people never stop weeping and wailing, but most pick themselves up, find out what is so, decide what the will do about it and take action. I think the developed countries will, by and large, do just that. And so will our companies. We will re-invent ourselves. But first we have to admit what’s so. Scientists do that on a regular basis, but it is slow going.

Neils Bohr said that “Science progresses one death at at time.” Old theories, old models die hard. I’m not wanting to hasten my own demise, so I will accept the new ideas on how business needs to adjust rather than stick to my old, comfortable ideas. How about you? Are you leading your company to new ways of looking at the way business is done? Are you actively changing people’s world view? Are you seeking new data? Trying new things out? How will you take advantage of the globalized changes taking place?

Someone posted a comment on the post “Fundamentals of great leadership, Part I,” that essentially said, “wondering why you aren’t still in that cushy W2 job, you will want to look back at what the Fundamental Organizing Principles (FOPs) for your venture were back when you were so. . .” and the post stopped there. The question is a really good one. I’m not sure who posted this or what they were thinking about when they wrote “for your venture back when you were so . . .” Still, the question is a good one if I assume that they mean this as a serious question and not as simply a judgment or challenge. So I will make that assumption. The comment could be from a former colleague, a boss, employee or stranger, so I can only answer the question “generically.”

My experience working with executives at all manner of companies this past decade since I left the corporate world is that only a few have consciously taken the time to understand what their FOPs are and how they use them to decide what they do in life. Some seem to “get it” but at a relatively “unconscious” level. A few have consciously gone through a process to figure out the standards by which they live and/or make choices. Further, it seems that many executives needed some sort of significant event in their life to cause them to take the time to review just what mattered to them. Sometimes it was a divorce, sometimes a serious health issue, sometimes a near death experience or serious accident that forced them to look at their own mortality. A few others, myself included, did not have a “sudden epiphany” but rather gradually came to understand that something had changed, that they were not as engaged as they used to be.

About two years before I left the corporate world, I began noticing that I was no longer focused on the business. It is likely that a combination of things caused me to get to this point. Perhaps it was the constant weekly commute from southern to northern CA. Leave on Tuesday to fly north, home on Friday; almost every work week. It could be that the company’s de-emphasis of the product line on which I was working finally made me realize that I needed to figure out what my next “gig” would be. More likely, it was a rather mundane and rather normal “mid-life crisis” that crept up and asked some not so simple questions, “What are you doing? What is your life about? How are you adding value and creating meaning?” At any rate, it became clear that it would be best for my company and for me to make sure that I did in fact figure that out and get on with whatever was to be next. The rigorous downsizing the company needed to go through was an opportunity for us both. I decided, shortly before the “reduction in force” that I was done with employment in large corporations and would create a life that would allow me to work “forever” at something that brings enjoyment and adds value. That pursuit has evolved into what I do today, and find so rewarding.

It is important to point out several things. First, there was no mismatch in “ethics” when I decided to go out on my own. That is to say, I did not suddenly wake up and think that I was being asked to do something that violated one of my FOPs. The company did not change, rather I grew and changed – I hope for the better. Second, I have absolutely only good things to say about the companies for whom I worked because without them I would not have gained the maturity and experience I need to perform as an executive leader coach – while earning a very nice living for my family along the way. I can honestly say that I enjoyed just about every day I had to go to work; even if the last couple of years were not quite as enjoyable as previous years, they were still challenging and the people with whom I worked were/are great folks.

What I came to realize is that I wanted to be more in control of making a difference and adding value “in the world.” I wanted to learn more about being people oriented rather than “thing” oriented – no small undertaking for a confirmed “nerd.” This past decade has been one of challenge, personal growth and incredible learning for me. And it is with a full measure of humility that I note several of the clients with whom I work have offered that I have been helpful to them – both in increasing their effectiveness as a leader and in enhancing their personal lives. That is incredibly rewarding to me.

So here’s the “bottom line” on all this. The commenter suggested I would want to go back and look at the FOPs for my venture. 1) I did that more than a decade ago when I left the corporate world. 2) Those values did not change, I just brought them up to a level of consciousness and evaluated them anew. 3) The companies with whom I worked did not ask me to violate those FOPs. 4) Once our children were raised and successfully out on their own (with their own FOPs!), I could change the emphasis on “how” I earned a living and lived out those FOPs. 5) My “new venture” (not so new anymore!) allows me to be more introspective, add value in a more “human focused” way, engaging others in professional positions, work in an incredibly wide variety of industries and continue to constantly grow myself. All very esoteric ideals. 6) On a more practical note; as a “boomer” it became clear to me that I was either going to have to be looking for a new employer every 24 to 36 months, and put up with the vagaries of the “job market,” or I was going to have to make my own “employment.” So here I am, and life seems to be much better than I had imagined. Still challenging of course, especially in the present economy, but then, why would I want it any other way?

The dwindling allure of building factories offshore

One has to wonder why this is such a “surprise” and so newsworthy. I guess it’s because we are looking for good news, ANY good news to give us some hope that the country’s economy is truly on a sustainable upward trend. Back when we were belly-aching about the auto industry losing its edge, there was a lot of discussion about how the foreign auto manufacturers seemed to be doing just fine using American labor and manufacturing right here in the good ol’ U.S. of A. So as labor costs increase in the developing economies and the cost of transportation continues to increase, we are sure to see movement of manufacturing to be closer to the markets served. The US won’t be left out of this continuing trend.

While manufacturing may still continue to lose jobs to productivity increases and may also find some industries just simply won’t be able to compete with manufacturing offshore, the trend to losing jobs to off-shoring should decline. However, it is doubtful, to say the least, that the U.S. will ever go back to being a premier manufacturer. What concerns me most is not the continued erosion (if you’re a pessimist), nor the slightly improved trend to competitive manufacturing (if you’re an optimist). What bothers me is that we are not investing in the education of scientists, mathematicians and engineers. Nor are we willing, it seems, to guide young people who will not attend college to solid careers in a trade. It will forever frustrate me that consumers will pay huge contracts to sports celebrities (read Moneyball to figure out how illogical we are about that market) who arguably do not contribute to anything except the advertising industry, consumers and shareholders allow outrageously large pay and bonuses to poorly performing CEOs and taxpayers agree to move tax dollars into providing cushy jobs , health care and retirement packages for politicians and public employees while ignoring investment in the very things that will make our economy thrive now and in the future. The good news is we live in a country where we can all choose to do these things. The bad news, in my mind, is that we as a society do choose to do them – or allow them to happen!

The loss of manufacturing is to me a red-herring. The real issue is much larger. What will America do to play in the world economy? What are we doing now to make sure we are ready to assume that place and compete successfully? Our multi-national companies will figure out the best way to manufacture. They will figure out how to minimize the impact of earthquakes and tsunamis on their supply chains.

Feel free to leave a comment on how you see our country surviving in the global economy. Since the global economy isn’t going to go away then we can’t set up trade barriers to protect our companies. If we cannot “unilaterally” play in the global market, then what do we do to make sure we add value?

Starting a business is one thing. Trying to turn the ship of state around and head it in a new direction is something else. Here are some thoughts that you can pick apart to apply them, hopefully, to your situation.

Have a great idea for a “new” product or service, or maybe a really neat innovation on an already existing product or service? That’s fantastic! That’s what our country is built on – innovation, improvement, change, moving forward. First, you might want to take that idea and “flesh it out a bit” to make sure it’s practical. Can it be built or delivered in a manner that will make it profitable.

Next, do exhaustive market studies. You can get some help on this and it isn’t always that expensive. I work with several of the universities in my area providing mentoring for the MBA and Entrepreneurship students. Most of the universities have programs where for a nominal fee, a business can hire a group of students to put together a marketing plan or even a full up business plan. The hidden superb value in these efforts is the research that gets done to produce them.

This part of due diligence is where many entrepreneurs fail. They love their idea and they cannot conceive of why the whole world wouldn’t also love it. “Build it and they will come,” is their mantra. WRONG! And while we know that intellectually, our emotional side wants to continue on down the path, convinced that everyone will love our idea. Tell me again why so many start-ups fail in the first five years? Could it be that their product or service wasn’t really needed/wanted? Hummmm.

Next on the list after REAL DATA tell us that the product is viable, is to think about the way in which you will assemble the organization. If you are planning on being a sole-provider (consultant, professional service provider) then you can very likely get started. You may still not want to skip this step, because in the dark hours when you are wondering why you aren’t still in that cushy W2 job, you will want to look back at what the Fundamental Organizing Principles (FOPs) for your venture were back when you were so enthusiastic.

This is hard work, especially if you intend to build a reasonably big organization, say more than 40 people eventually. The bigger you envision your organization, the more critical it is for you to do the hard work of deciding what the FOPs (core values, company values, etc.). The reason this is hard is because you are laying down the “talk” that you will have to “walk.” Suppose your thought process takes you down the road that you believe the only reason for a business to exist is to serve customers – to solve their problem/need/want in an elegant and cost effective way. Of course, you also want to earn a living and make sure that those who you employ also enjoy a decent living.  Starting with the customer then, you would perhaps say that one of the FOPs is that “Customers First.” Without customers you don’t have any business. To take care of those customers, you must have employees that understand the balance between putting customers first and also making sure that the company survives too. Having the customer’s best interest at heart doesn’t mean that you neglect your own best interest – it simply means you’re focused on the customer first. So a second FOP might be that “associates” will hold each other accountable for providing great customer experiences while treating each other with dignity and respect in a safe environment focused on continuous improvement.

You get the point. This FOP establishment must be done honestly, from the heart and from the intellect both. If you truly believe that the only reason to be in business is to make yourself rich, then you will definitely build that kind of organization regardless of the other nice (manipulative!) words you use. Further, you will hire people who will not act the way you want unless you are brutally honest that the whole purpose is to make yourself rich, and maybe them along the way. On the other hand, if you honestly believe in building a company that is based on providing a valuable product or service while at the same time making a decent living for everyone involved, then you will attract that kind of person. That is you will, IF you can authentically state what your company’s FOPs are and the prospective employee/associate believes that in fact you are being authentic.

Once you have established the FOPs for your organization, know how to authentically present them to the world, you will be amazed at how the values, beliefs, actions and results will follow. You will also be amazed at how those FOPs will help you through the inevitable hard times. All of this may sound pretty “soft” to you. Yet, I would offer the challenge of doing the research to see how companies “make it” these days. Edwards Life Sciences, Google, Facebook, IBM, Keurig, you name your favorite company. They undoubtedly have an intentional culture based on whatever they call FOPs. And then think about the company you like to “hate.” You have at least one, I’m sure. That company “doesn’t get it.” And the “it” they don’t get is what? Likely it is that they don’t understand (your view of) customer service. They are inwardly focused. It’s all about them and they only care about YOU if it’s in their best interest to care about you. Otherwise . . . .

In this economy, which I believe is going to be with us for quite a while, many business leaders are asking a fundamental question, “If I weren’t in this business now, would I start it? What would it look like? And then they start the hard process of turning the company around. To me, that is very much like starting the company over in a lot of ways. Many of the same steps apply. That “turnaround” will likely include changing the culture and that is really going to be a challenge! Don’t miss any of the steps, make sure you go back to the basic FOPs that got you started in the first place.

At the end of the previous post, I mentioned the fact that we need to add the concept of “feedback” into the model. The tricky thing about all this feedback is that we are masters at seeing only what we

Positive Feedback

believe. So if we believe we “know what is so,” or “how the world really works,” or “what the truth really is,” we will see those things in the data we review. In other words, we are great at denying reality if it conflicts with our view of reality.

If we look at the results of our actions, that is we look at the data from our measurements, and if that data appears to be what we expected, then we will conclude that our beliefs and values are correct and that the “real world” responded to our actions as planned. But here’s the rub. We often do not see the data for what it is. We see what we believe, so we are often blinded to the fact that the data is suggesting that we did not see the world as it really is, but as we wish it to be.

Rest assured that (a) you aren’t the only one who falls prey to this all too human trait or that (b) highly educated people are not susceptible to this same human trait. All our science based studies show that you are definitely not alone and that even highly educated scientists who rigorously follow the scientific method fall prey to the way our brains discern and filter patterns.

Negative Feedback

What happens when the information we receive back from our actions does not meet the expected results? Unfortunately, the more common response is to assume an anomaly – a “one off” result. We automatically assume that our process, our thinking, our beliefs and our values must be sound, so nature threw us a curve on this one! Yet we now know that our brains are pattern recognizing and meaning making machines. We make up meaning and we see patterns that do not exist or have no significance in the “real world.” We often do not see things that are so, but see things as we wish them to be.

This tendency creates real difficulties in all aspects of our lives including in business. But great leaders will more readily see that the data is suggesting that their view is wrong or incomplete in some fashion. They are willing to admit that they do not know what they do not know. Gian Carlo Menotti said, “A man only becomes wise when he begins to calculate the approximate depth of his ignorance.” Yet we do not easily see or admit to the fact that there has to be far more that we don’t know than we do know about the universe and how it works.

The successful leader helps her team to see that the data points in a certain direction regardless of what the conventional wisdom claims is so. Hypotheses are tested in depth to be sure of their veracity. The effective leader agrees that “what gets measured gets done,” and is willing to make sure that not only is the measurement the correct measurement for the process but that the resulting data is actually seen clearly – not filtered through preconceived world views.

Thus a critical component of the proposed FOP model is not only that the leader do the hard work of getting right down to the very basic Fundamental Organizing Principles, but that s/he also make sure that they recognize that they have filters and try to find ways to mitigate the effects of how the human brain works. At present, I see no way to remove the filters other than to remove the human. Perhaps that is why when we leave some things to the computers, the outcome is better and improvements are made. But at least if we are aware that we only have part of the whole truth, that we are each like one of the blind men exploring the elephant (I’m sure you’ve heard the fable of the Blind Men and The Elephant by now). It is the human condition that because of how our brains evolved, we are all blind men and women when it comes to the whole story about what is actually so. Great leaders “get” that and so they seek to truly understand. Then they steadfastly pursue the goals UNLESS accurate data dictates otherwise. When a change in strategy is dictated by reality, the great leader is the one who admits to the necessity of change, rallies the team and enrolls them in the new direction. She (you) can only do this if you recognize the limitations of that computer between your ears and are willing to compensate for the buggy program!