No interest, no payment for one year, $35,000 loans available from the SBA

The Small Business Administration released "lender guidelines" yesterday for the America's Recovery Capital (ARC) Loan Program. While the program was announced back in May, details on the $35,000 interest-free, deferred-payment loans are only now available.

I was on the phone with Eric Zarnikow, Associate Administrator for Capital Access, the SBA department overseeing the ARC loan program, and he told me that, "Borrowers can begin applying for these loans beginning June 15, per the Administrator's May 18 comments. We estimate that the SBA, through our lenders, will be able to provide about 10,000 ARC loans to small businesses across the country."

You can read my article with more details on these loans on Entrepeneur.com.

What are ARC Loans?
ARC loans will be made for up to $35,000 and available to established, viable, for-profit small businesses suffering "immediate financial hardship" in order to provide some temporary financial relief so they can keep their doors open and put their cash flow back on track. It is intended for businesses that need short-term help to make their principal and interest payments on existing qualifying debt (including conventional loans, credit card obligations, notes owed to suppliers and utilities).

So what exactly is a "Viable business?"
Zarnikow says the SBA defines this as "a for-profit business with evidence of profitability or positive cash flow in at least one of the past two years."

How does the SBA define "immediate financial hardship"

The SBA is requiring businesses to show evidence of a "change in the financial condition" such as declining sales, frozen credit lines, difficulty meeting payroll, paying rent or difficulty making loan payments. The lender must analyze and confirm that a hardship exists.

How do ARC loans work?
The loans are 100 percent guaranteed by the SBA and made by existing SBA 7(a) lenders. They have no SBA or lender fees associated with them (unless the lender must secure collateral as part of the loan). The disbursement period (up to six months) is followed by a 12- month deferral period with no repayment of principal. After the deferral period, the borrower pays back only the ARC Loan principal over a five year period. ARC loans are available through SBA-approved lenders as long as funding is available or through September 30, 2010.

Mark Deo will help to guide you through the loan process
I have spent a great deal of time discussing these programs with officials at the SBA, as well as proving insight to some of the most influential business publications in America, including Entrepreneur Magazine. As a reader of my business update, I am more than happy to share this information with you- all I ask is that you purchase a copy of my new book, The Rules of Attraction. If you have a copy of my book, and you want to get my insight on how your business may be able to obtain an ARC loan, please send an e-mail to mark@markdeo.com and include your name and phone number. I will personally call you to help you assess your prospects of obtaining one of these loans.

Click here to purchase my book from Amazon.com.  Remember that 100% of the profits from my book go to the charity Habitat for Humanity.

Thank you, and have a great week!

-Mark Deo

Thoughts on the Stimulus Package

I am being asked to comment in a number of media outlets about the impact of
the President's stimulus program on small businesses. Today I did an interview
for MSN Business. Later this week I will be talking to La Opinion. Here are some
of the typical questions I have been receiving and the answers I am giving. I
have done this in outline form so that you can read this very quickly. I'd love
to get some feedback from our readers.

How important is small business to the U.S. economy?


• Small businesses drive this economy


• Employ about half of the nation's 144 million private sector workers


• Account for 60 to 80 percent of new private sector jobs


• Generate more than $6 trillion in annual revenue


• Account for more than half of the country's GDP

What do small businesses possess that larger enterprises lack?


• Personal passion: Personally invested rather than Wall Street dollars.


• Customer-centric: Deep understanding of customer needs and opportunities.


• Agility: Adapt quickly to changing market conditions and new business practices.


• Experimentation: NOT afraid to improvise and accept failure as a path to success.


• Limited resources: Adept at accomplishing more with less with little waste.


• Collaboration: Rely on social networks, affiliates, alliances and information sharing.

What are the economic challenges for small businesses today?
• Crushing debt due to asset devaluation


• Lost 4 million jobs in the last year and more than half are small business jobs


• A significant drop in sales and productivity in every industry except Washington


• Lack of access to capital or affordable funding


• TARP participating banks will likely not participate limiting the ability to fund loans


• Wickedly fierce competition and price erosion

How might small business's benefit from the President's stimulus plan?

• Obama earmarked $15 billion of the $789 billion stimulus package for small business


• $730 mil to reduce small business lending fees


• Increase SBA loans to 90%


• Attempting to open-up secondary market credit

What are some of the problems with the plan?


• Incorporates a HIKE in taxes for all households and businesses earning more than $250,000


• Higher dividend taxes


• Limits on itemized deductions


• Small businesses will likely have to shoulder a more responsibility for worker health care.


• SBA was planning to guarantee $20 billion in loans yet currently on-track for less than $10 billion!


• The US government is not in-touch with the needs of small businesses – they are spending billions to save 250,000 auto-maker jobs while already 4 million small business jobs have been lost!

Summary

While I cannot place the complete blame for this conundrum at the feet of this
new administration I believe the outgrowth of this stimulus plan is like taking
capital and revenue from the mouth of America's small business owners and
feeding it to the big National Banks, Wall Street financers and government
bureaucrats. This theory enraptures Wall Street and alienates Main Street. Don't
expect help from the government. Small business leaders are on-their-own. That's
good for those willing to roll-up their sleeves. This is how our country became
great – on that backs of small business leaders!

We all have to answer the question: Do we have a fighting chance or just a
chance to fight? I believe the former.

Recommendations for small businesses:

Business attraction is more critical than ever:


• Become a bigger fish in a smaller pond by shrinking your audience.


• Create standards and systems to leverage efficiency and accommodate growth.


• Be willing to destroy and rebuild your business or re-invent yourself especially NOW!


• Innovate or die! It's time to launch your most creative products, services and marketing.


• Take advantage of all the great talent on the street.


• This is the time to enter into collaborative alliances, affiliate relationships and joint ventures to consolidate costs and spread risk.


• Localize or globalize! There is no center ground today.


• Invest wisely. This is the time to buy – learn how to identify devalued assets.

Sources:

U.S. Department of Commerce, Small Business Administration, Intuit Future of
Small Business Report, Institute for the Future, Huffington Post, MarkDeo.com

-Mark Deo

Take Your Foot Off the Brake!

Have you ever driven your car on an icy road?
What happens when you jam-on the brakes?
That's right, you slide off the road and maybe end-up in a ditch or worse.

That is exactly what is happening to many people today. They are spending entirely too much time watching, reading, listening and talking about how BAD things are in this economy. They are focusing on blaming Bush or Obama or the Fortune 100 CEOS or whoever. As a result, they can't help but react with fear by jamming-on the brakes.

My winters in Chicago taught me that when I was driving on icy roads and I would hit the brake it would not "prevent" an accident but rather "cause" one to occur. When we blithely slash expenses, lay-off our best and often highest paid people, discontinue investment in technology, marketing, training or improvement programs we are actually RE-ENFORCING our worse fears and jamming on the brakes. I can assure you that this will cause us to end-up in the ditch. Getting out of the ditch will not be easy and in many cases will end-up costing us more than we save.

Instead, I want to encourage entrepreneurs to certainly drive carefully and more diligently. To continue the analogy, we may need to slip into low gear but maintain that steady forward motion. This challenging economic environment is presenting new opportunities (devalued technologies and businesses), the opening of new markets (Green and sustainable areas) and allowing us to access resources which have not been as readily available when times were good (there's more great talent on the street). This is a fabulous time for small businesses to grow and prosper. My most successful clients are now investing more into growth and expansion opportunities than ever before! We are taking our own advice and investing in the release of my new book, The Rules of Attraction, the release of our new Small Business Radio weekly show and in hiring several new consultants!

Just like navigating a treacherous stretch of icy road, it requires careful planning, quick reaction time, precise execution and a healthy risk tolerance. I plan on safely arriving at my destination on time and ensuring our clients do as well. Our positive mindset, practical skills, and sharp wits will permit us to do so. Won't you join me?

Your action plan for this week:
Turn-off the news!
Cancel the daily paper!
Stop talking about how bad things are!
Don't buy-in to the FEAR mentality!

I predict just 18 months from today, you will look back and be happy that you did.

Have a great week!

-Mark Deo

Turning the Economy Around

This is an interesting time. The recent layoff of 80,000 American workers has resulted in all of the financial gurus spouting their drivel about the global economic crisis we are facing. I have even heard some say we are entering another depression. Just a few days ago, I appeared on FOX TV and discussed this with business expert Neil Cavuto. He asked me how I thought this was affecting small business owners and what they could do about it. My comments were that maybe we should put some of these gurus on the firing line of small businesses and see how they do. Their demise would be quick and final. Because as I told Mr. Cavuto, the most important asset that entrepreneurs have today is their attitude.

Without a positive attitude, we are doomed regardless of how well or how poorly the economy is doing. Many of us perhaps have heard the Serenity Prayer - "We must accept the things we cannot change, have the courage to change the things we can, and wisdom to know the difference." Surely, we cannot individually change the economy but collectively it is certainly possible. We can do this by focusing on the critical business issues at hand like, delivering a higher level of customer satisfaction, creative product development and line extensions, smart financial management, getting longer terms on payables, building customer loyalty programs and penetrating new markets. We do have the ability to turn this economy around but we must first look in the mirror and begin the change within. Do you have the courage to take that challenge? I sure hope so. All of our jobs might depend on it.

Click the Fox Business logo below to view my latest appearance:

Have a great week!

-Mark Deo

The Capacity for Change

My hand firmly grasping the remote, I was "couch surfing" the other day. You know how it is - over 2000 channels and still... there's nothing worth watching.

Suddenly I came across the Crocodile Hunter battling some prehistoric-like creature in the Aussie brush. I thought, here's my old friend Steve Irwin, animal enthusiast, environmentalist and master marketer, dead and gone, yet his show is still in reruns.

But wait... this wasn't a re-run! This was new. It was being narrated by Bindi, Steve and Terri's little daughter. She was articulate, interesting, and REAL. This was just another extension of the fabulous enterprise that Steve had built.

When I was last in Australia, I was told by many that they believed that Steve had done more for the country economically than the last two Prime Ministers had. Now his daughter is carrying on this enthusiasm. Not only does Bindi, all of nine years old this year, host the Crocodile Hunter but she has her own TV series on Discovery for Kids dubbed "Jungle Girl," she has released her first CD of her music and she even has a line of clothes for kids called "Bindi Wear!"

Crikey! What a capacity for change Steve has. Even in death, his brand is unstoppable.

But not everyone has a high capacity for change. According to Rick Maurer, author of Building Capacity for Change, only one third of all change succeeds. Most approaches to managing change ignore or trivialize the need to build commitment to changes such as continuous improvement, training, re-branding, re-engineering, and new software systems. We live in an age of rapid and chaotic change. Failed changes cost organizations dearly. Research indicates that resistance is the main reason why so many new initiatives go way over budget or get implemented in ways that really weren't worth all the effort and cost. Are you or your employees resistant to change?

I myself have battled change over the years. For example, as many know I have had a radio show on the CBS Radio Network for over 10 years that I have recently abandoned in favor of a brash new change. Many have told me that I'm nuts! Perhaps they are correct. Nevertheless, our NEW show, Small Business Radio, debuts this Friday on one of the largest Internet radio networks in the world. The show airs LIVE every Friday at 4pm Pacific time. We will take your calls and every week we will feature a business expert. Just click on the link below to access the show LIVE or hear archives of past shows. Or just go to www.markdeo.com to tune in.

So what's your capacity to change? Are you too busy to commit to improvement?Are you kidding yourself and just coasting, hoping that things just don't change too much? Or are you like Steve Irwin always battling a new predator and conquering change even from the grave. I hope the later. I trust this helps you to begin see change as a friend and as the precursor to growth.

Have a great week!

-Mark Deo

Short Change

The funny thing about change is that most people are unhappy with the way things are, yet few want to go through the pain of changing. In a way this amounts to SHORT changing ourselves.

Change is upon us. Ready or not, here it comes- politically, socially, economically, and financially. The question is not if will we be facing change in the coming year, but, "how will we deal with it?"

I like to believe that if we approach change from the standpoint of "attraction" then we can transform "adapting to necessary change" into LEADING revolutionary change! This is one of the reasons that I have created my "attraction principles." I believe that with the right knowledge, mindset, and discipline we can actually "attract" a positive, desirable change, rather than being swept-up in unwanted change. 

Over the next few weeks, I would like to share these principles with you, my clients, class members, subscribers, and listeners. It is my hope that they can help you "take control of change." Each week I will focus on several principles and discuss how practicing them can help us to create sustainable change, win deeper relationships and become more influential to those within our sphere of influence.

The 14 Rules of Attraction

1. Become a big fish in a smaller pond.

2. Strategic rejection makes us more attractive.

3. The problem is more important than the solution.

4. Give information away without selling.

5. Reverse people's risk in changing.

6. Don't be a better option, become the ONLY solution.

7. Create an exclusive community of "super-users."

8. No one has time to read so let design and color speak.

9. Traditional advertising is a HOPE business.

10. Collaborate rather than compete.

11. Who we are is more important that what we do.

12. Create standards and systems that nurture.

13. Learn the discipline of testing.

14. Plan your dive. Dive your plan.

Helloooooooo Tom!
We have been invited by CBS radio to participate in an event to help small business owners and entrepreneurs prepare for 2005 and all of the changes that are coming.

Join me on Saturday, November 13 at the Hyatt Regency in Anaheim with fellow talk show hosts: Tom Leykis, Doug Fabian, and Gabriel Wisdom for the first Financial Fest sponsored by 97.1 KLSX, the FM Talk Station. 

Throughout the 9 a.m. to 5 p.m. jam-packed day, you'll be treated to a panel discussion with business and investment experts talking about small business, building wealth, real estate, and more. At the Financial Fest, we will be available to answer questions and will be giving away one set of our "Attract More Business Program."

TeleClinics to be held every Monday at 1PM
To provide additional benefits to our subscribers, in November and December we will be holding a series of TeleClinics aimed at improving your attraction quotient.

11-15-04- How to Avoid the Typical Mistakes Marketers Make
11-22-04- The Exclusive Marketing Position
11-29-04- 10 Key Criteria for Developing a Branding Statement
12-06-04- Getting Commitment with Risk Reversal
12-13-04- Rules for Writing Headlines
12-20-04- Bull's Eye Ad Design and Layout

To register for any of these Tele-Clinics go to https://www.sbanetwork.org/learning/signup.aspor call 310-320-8190. For more tools of "attraction" go to www.markdeo.com.

Don't short change yourself in the coming year. Let's focus our energy on attracting precisely what we are looking for. Remember we have to TAKE control in order to be in control.

One Step Beyond

You may faintly remember it or perhaps you've seen the re-runs: One Step Beyond.

It was that old science fiction TV series where the implausible became the possible, right there in your living room. Supposedly the stories were based on fact. I don't know if they were or not, but it made the show more fun to believe the stories were true. The host John Newland, would give you some spiel about ESP, teleportation, automatic writing, bi-location or some other questionable science and launch into another "true story."

I remember one episode in vivid detail. A woman keeps having dreams of a plane crashing through the ceiling. Overcome with fear, she and her husband move into a hotel - and once settled there a plane crashes through the ceiling of the hotel. But the pilot is saved and the couple gets out of the way when they hear the plane coming in.

Today that episode sounds a little too much like reality.

But it made me think about how we as entrepreneurs and small business owners can become fearful of the INEVITABLE. At times we fear the inevitable so deeply that we find ourselves rushing headlong into the very thing we've been trying to avoid! The women's dream created an irrational fear that prompted her to leave her home for a place of safety only to find that it was her fear that placed her in the most dangerous situation.

Business circumstances can be like that. We try to escape the inevitable conditions of a difficult economy, fierce competition, the dot-com implosion or a maturing product lifecycle by running from them rather than facing them head-on.

I have seen more than one example of otherwise talented and energetic individuals paralyzed by fear. They procrastinate or even completely avoid taking on projects that would benefit them and their company. Their inevitable excuse: "I am dealing with too many problems right now; I know I (we) should do this but I can't deal with it with everything else that is going on." This is classic conflict avoidance. Avoiding conflict will only serve to produce more devastating symptoms and ultimately end in disappointment or worse.

There are many people in business today that have never been tested by an economic downturn. They have little experience with difficult times. It is easy to succeed when times are good. What differentiates the experienced business owner from the naive is doing what must be done when times are tough. Successful decision-makers redouble their efforts to outpace the pack when it is most difficult. They are willing to go "One Step Beyond."

Here are some pointers to help you go "one step beyond" in your own business. Are they easy to implement? No, but they are powerfully effective when combined with persistence, enthusiasm and sweat:

No Risk, No Reward - Playing it safe isn't necessarily playing it smart - even in cautious times. Don't be Afraid of Risk. To not take a risk is to risk being ignored.

Plan to be a Lot Better - You can't win in a competitive market by doing things "a little" better than the competition. You have to be a lot better or completely different.

Stand Out from the Crowd - You can't simply sound like everyone else. You MUST be unique. How can you change your process? What additional service can you provide?

Zero In - Who can you exclusively target? What part of the marketplace is most precisely suited to your product or service? Or maybe, more importantly, which type of prospects do you NOT want as customers? Sometimes it's easier to eliminate the chaff from the wheat.

Don't Be Afraid to Take Action - Remember the good moves you DON'T make can be as consequential as the bad moves you DO make. For many business leaders inaction is the worse course of action.

Get Emotional - Emotion grabs attention and ultimately sells your product or service. Tell your story in such a way that your product or services becomes totally relevant with your customers lives.

Do the Unexpected - Remember while you're sitting with your staff trying to think of what to do next so is your competition. If you can make an unexpected move then you may have the most important element of success: SURPRISE.

Cultivate a Culture of Learning - The fastest way to failure is to stop learning. Make learning a habit for yourself and for the people in your organization.

Seek to Create Change - Many consultants and business pundits today are advocating all kinds of methods of "coping with change." I wholeheartedly disagree. This makes it sound like change is biting at our heels. Put yourself in a position to CREATE change. There is an amazing advantage in being the creator of change rather than the one who has to cope with it.

You may be hearing that buzzing of a plane in the distance. It could be your competition or the economy or even the groans of an industry in travail. But don't turn and run. Face your foe head on with confidence and self-assurance. In doing so you will fuel growth and profitability in your business. By embracing change you will crush fear and go "one step beyond."

Learning to Learn

He who would learn to fly one day must first learn to stand and walk and run and climb and dance, one cannot fly into flying.

-Friedrich Nietzche

As an amateur percussionist for 19 years, I can remember when I first heard a tape of Buddy Rich playing drums. It was a tape of the Buddy Rich big band recorded in the mid 70s called "Ease on Down the Road". I was amazed at the intricate patterns he was able to play, both by his creativity and by the physical ability he had that allowed him to produce these sounds.

At the time I had only been playing drums for about a year, but I sat down at my set inspired by what I had heard and tried my best to play along. As you may guess, I was unable to keep up with what he played- I sounded much more like Buddy Hackett playing drums than Buddy Rich. As a beginner I had no chance at replicating a pattern played by the world's greatest drummer. What I took from that experience was the knowledge that if I ever hoped to play like Buddy Rich, I had better practice - a lot. So I dedicated myself to becoming a better drummer, and I practiced every day; I just about wore out that tape from listening to it over and over again, hearing something new in it each time I listened.

After a few years of practice, I was able to play a few of the riffs Buddy played on that tape. It brought me incredible satisfaction to finally be able to play along with it. What enabled me to play along was my years of practice, and to me, they were worth it. That practice also brought me the opportunity to play in an honor orchestra at the Dorothy Chandler Pavilion, an honor band in the Rose Parade, and led me to later play drums in a bagpipe and drum band with some of the best players in the world. Not only had I achieved the goal I set, the work I put in brought other rewards; I ultimately enjoyed the side rewards far more than being able to play along with my tape.

In our businesses, we sometimes see competitors who appear to be so far ahead of where we are that it can be discouraging. We are made to feel that no matter how hard we work we will never beat Wal-Mart or Amazon.com at their own game. By looking to these businesses as inspiration, rather than as behemoths who are trying to crush us, we have the opportunity to learn how we can be more like them.

What makes Wal-Mart such a dominant force is not just the volume discounts they get as a huge chain, but their reputation for great customer service and friendly employees. Amazon frequently is more expensive than their rivals, but they sell more because of their extremely easy to use ordering system. As a business consultant for the Small Business Advisory Network I have learned that these elements are more important than price to the success of a small business.

I've learned that developing a reputation as a company with excellent customer service can be much more valuable to your business than having the cheapest price for your products. I've learned that having an easy to use shopping system is critical to e-commerce web sites. Knowing that these are the reasons people buy from your competitors is insufficient.

Just knowing that I wanted to play like Buddy Rich however, was still short of making me actually sound like him. I knew that it would take a lot of work to just play along with a tape, let alone ever create music like him. So what do we do? If knowing what we want our business to be like leaves us with lots of work to do, is it worth it? Most entrepreneurs will say that they're too busy to practice - it's hard enough trying to just run their business.

Douglass Adams wrote, "Human beings, who are almost unique in having the ability to learn from the experience of others, are also remarkable for their apparent disinclination to do so." This is proven true time and time again.

But as W. Edwards Deming wrote, "Learning is not compulsory; neither is it survival." We need only look to the bankruptcies of Kmart and pets.com for examples of businesses that refused to learn from their competitors. They surely knew what their competitors did better than them. They might even have wanted to do those things themselves. But they didn't put in enough practice to make these changes.

Target and Barnes and Noble, however, are two examples of thriving businesses that DID learn from their competitors. Instead of just seeing how their competitors operated and hoping they could be more like them, they actually put in the time and effort it would take to change, and are now reaping the rewards of doing so. Learning only occurs when we see what we want to become and work toward becoming it.

I encourage you to figure out what your bigger competitors do better than you. Then decide how you can practice these skills to get better at them so you can use these new skills in your business. While you may never beat your competitors at their own game, you can learn some of what makes them successful. By using these skills along with the things you already do that make you unique, you provide a better overall option to prospective customers.

This "Business Update" was written by SBANetwork Sales Technology Specialist Matthew Walker.

Killer Complacency

Change.... Who needs it!

Most of us would be happy campers if things would just STAY THE SAME. Sometimes it seems if we ignore a problem long enough then it will go away. Or we may look at a circumstance and say, "it's not precisely what I'd like to see, but I guess I can live with it." Surely this is easier than making a CHANGE. Ughhhh! Anything but change. Let's "wait and see."

I see many entrepreneurs and small business leaders become complacent after having several successful years behind them. However, today's economic environment, political situation and competitive landscape are shrinking profits for businesses nationwide. Dominant competitors are much more powerful, financially adept and possess more resources then ever before. Often times they can offer a similar product or service at a lower price. If we hold steadfastly to the ideals of the past and resist change, there is a good chance that our business will suffer severely.

As entrepreneurs and small business professionals we can not afford to make very many mistakes. It is not enough that we recognize problems WHEN they occur. We must develop systems that help us to quickly identify signs of impending trouble. By doing do we will ultimately save our company long term problems and expenses in a relatively short period of time. We must be ahead of the curve. We must influence change BEFORE serious problems emerge. 
There are many reasons that business failures are at record levels, but I believe the primary reason is the inability or refusal to adapt to a rapidly changing economy. Studies show that more businesses fail or regress due to lack of attention to early warning signs then any other reason. The signs are almost always there. You do however, have to be willing and able to see them, accept their reality, and deal with them NOW! The major problem I see is that they are not perceived as "real" signs only short term problems that will be fine in a few weeks or months. They also may be seen as related to "uncontrollable or external factors" where nothing can be done, while the competition is being proactive to these same factors because they recognize that this is the real world and they still have to do business in it.

A while back I was fortunate enough to take a cruise. Kathy and I marveled at the magnificence of the cruise ship. We decided to take the tour of the bridge of the ship and I noticed the officers hovering over some instruments and discussing something. When I asked our tour guide what they were doing he told me they were making a turn. Apparently in order to turn the massive ship they had to begin to negotiate the turn several minutes in advance. Our businesses are like that. If we decide to hire someone today, in all likelihood that person will not begin to be fully productive until two or three months. They will need to be trained, assimilate into the company culture, and become proficient. This is why knowledgeable, experienced management is so critical in small businesses today.

I'm NOT talking about experience in an industry, product or trade but "decision making" experience. A demonstratable skill in making decisive, proactive business management decisions is at a premium today. Companies now run lean and mean and there tends to be a shortage of management, not an overabundance. Simply put, even if there are people on the payroll that are capable of solving the problem, they are usually bogged down daily putting out fires. They are almost always willing but due to time constraints not able. Important long-term projects always get back-burnered to current fire-fighting. This is unquestionably detrimental to the near and long term future of the company.

We all have this feeling of infallibility. It can't happen to us, maybe the competition, or all the people we read about in the papers and business journals everyday but not us. WE know what we are doing! But when we procrastinate making changes it leads to a decision delay that costs the company much more in the long-term then a positive (albeit difficult) decision would now. Often times the easy choice may not be the right one. This kind of complacency is the biggest killer.

I hope this motivates you to take action by:

• Removing complacency from your decision making process.
• Becoming the catalyst for influencing change in your business.
• Developing systems that allow the warning signs to become visible.
• Getting outside, experienced management help early on.

Fuel for the New Economy

I remember my 1966 Mustang. I sold it for $600 in 1976 before going to grad school and Im still kicking myself over that! Everyone loved Ford in those days. But its not easy to believe in Ford these days. The auto giant has lost over $15 billion, closed factories, shed tens of thousands of jobs, sold-off Jaguar, Land Rover and given-up the No. 2 position in sales to Toyota!

Their new Chief Marketing Officer, James Farley formerly with Toyota was rehearsing for his speech to dealers, stockholders and company leaders. As the lights dimmed, Mr. Farley didnt calmly announce his future plans or quote statistics. Instead, he spoke from the heart, revealing a depth of passion for Ford that turned the room dead silent. He became swept up in the emotional power of the moment. I believe, in many ways, the future of Ford is the future of our country, he said. The work here is simply more important than the work I was doing at Toyota. When he finished, the dealers rose for a standing ovation that left Mr. Farley momentarily stunned. After the applause died down, he savored the reaction. They were waiting for someone to believe in.

Computers, automation and mobile connectedness has had a strange impact on people today. It has caused a desensitization of emotional response. We want to quantify and analyze everything. It is draining the passion and heart from all that we do. I would like to encourage business leaders today to let their true emotions show. Cry real tears, quake with true laughter and shake with anger if you must. Dont downplay the power of REAL EMOTION. Your team is depending on your genuine emotional display to motivate them. It is the fuel for their continued belief and a precursor to talking action!

Have a great week!

Fight Back

So much has already been said with regard to the horrific incidents in N.Y. and Washington that I am hesitant to even broach the subject. While I thankfully did not have anyone close to me killed or injured in the blasts, I offer my sincerest condolences to those who have.

I do however feel a personal assault in that I spent quite a bit of time in these buildings when I was working with the consulting firm Walker Group International. My client, American Express, had offices at One World Trade Center. I would ride the elevator to the 76th floor and marvel at that incredible structure. I remember the folks at American Express teasing me the first time I felt the building sway. They told me it was going to tip over and they got a big laugh out of my reaction.

I am saddened by the loss and like many others, angry enough to take up arms and fight back. But I'm sure our military will do just fine without my assistance. After thinking about this however, I have come to the conclusion that there is another way that we can fight back.

Our enemies are expecting us to cower, cringe and shrink. Their goal is to destroy our economy, crush our way of life and show the world the folly of Western civilization. But we can deal them a powerful blow. We can push this economy up a notch. That's right, we can turn our depressed economy and somber demeanor into a time of unprecedented prosperity. How confident are you in America? Are you confident enough to put your money where your mouth is?

Up until Tuesday morning many small businesses and entrepreneurs had plans of expansion, reinvestment and improvement. As a result of the events this week some may plan to delay expansion and take a "wait and see" attitude. This may appear to be prudent at first glance but the impact on our economy would be even more disastrous than this week's horrific events. This would be caving in to these fanatics. It would be granting them the provocation of "terror" that they so deeply desire.

DON'T LET THEM WIN!

Make the decision to fight back.

How?

1. Plan even greater expansion of your business. Small business drives this economy. Your positive actions will fuel economic growth and confidence.

2. Don't cancel planned initiatives. Go to those trade shows. Buy that new software. Hire those people. Launch that new marketing campaign. Place those new ads. Push for greater market share.

3. Speak confidently about our future. Tell your clients, vendors, employees, colleagues, friends, neighbors and relatives that everything will be OK - nay in fact - BETTER than before. Let the words you speak be evidence of your confidence and determination.

4. Buy stocks. Support every company you believe in. Execute those trades early and often. If our markets soar on Monday, we will stun the world and prove that we are serious. That message will be very clear: If you want your fortune to be safe, invest it in America and its industry.

My small business friends, this is the clearest message Americans can send the world. It says that we are determined not to be pushed around. We will put our money where our mouths are and stand up for our economy. We will stand behind our way of life, which is exactly what the enemy aimed at when they flew those planes into the World Trade Center buildings.

We are not helpless! Let's support our military in their fight with their weapons of destruction. But let us fight with what we have: our wealth and determination. This may be as close as we can get to pulling the trigger on our enemies.

Creating Change

Any major transformation within a company will awaken "change." This change creates emotions and fears among the members of the organization.

Change is stressful. But stress is a stimulus that can be positive or negative. Studies have shown that stress in the workplace most commonly occurs in one of three situations:

1. When there is a high demand placed on employees
2. When employees are being closely watched
3. When employees are concerned about their competence

As a leaders it is our job to quell those fears. When we operate in the management role we must balance our passion, execution and sensitivity. It is good to be passionate about where we are taking our organization. But even more important is translating this belief into action. Taking part in the execution process makes a big statement to your team. The best generals have led their troops into battle at the FRONT of the lines. You won't win cooperation by calling the plays from the sidelines. This will create resentment and reduce morale. Finally be sensitive to the emotional and behavioral issues involved in change. Get in touch with how the change is affecting each of the critical members of your organization.

In order to truly put these precepts into practice, we need to understand the way change works. As Jeanie Daniel Duck says in her book, "The Change Monster," organizational change consists of five basic stages:

1. Stagnation
2. Preparation
3. Implementation
4. Determination
5. Fruition

Stage 1: Stagnation
This first phase can be summed up in two words: demoralization and denial. A demoralized company exhibits the same symptoms as a depressed person: general slowness, difficulty in making decisions, and a lack of motivation. Stagnation can be caused by poor strategy, lack of leadership, too few resources, conflicting goals or poor execution. Before you can implement a sound strategy, however, you have to modify the culture of the company - it's beliefs, attitudes and habits. In most cases these are the elements hindering growth. To burst free of stagnation, you need to ask yourself: "What outdated beliefs and behaviors are preventing us from conceiving or executing a winning strategy?"

Stage 2: Preparation
During this stage, many operational issues are addressed. This often results in a new structure for the organization, new employee roles. New responsibilities are designed, and management determines which products or services will be most critical in the future. The goal in this stage is to align and energize our management team around a corporate strategy and vision. As leaders we must all consistently articulate the SAME vision. In other words, we all need to be on the same page as to where we're going and how we plan on getting there. Only then will it be clearly understood and executed by others. We also need to be careful of becoming too dictatorial with our precepts. The goal is to develop a group thinking about change. This can't happen if the leader isn't open to hearing criticism of his or her ideas.

Stage 3: Implementation
Implementation is different in every organization. Leaders are responsible during the implementation phase for managing expectations, energy and experience. Asking people to change can create resentment, embarrassment and tension. Here are some ideas to reduce the barriers to change among team members:

• Test before deployment - If a new process is being implemented, try it in one department or with one product or service group before rolling it out.
• Build behavior first - Focus on a SINGLE OBJECTIVE and ask the employees for input. This allows us to empower our team by letting them SHOW YOU how they can come up with the solution.
• Plan replication - Duplicate your successes. Transferring change from person to person takes time. Let change spread rather than forcing it on your team.

Stage 4: Determination
Because change does take time, many of the former champions of change may have developed second thoughts. At this time it is not unusual to see conflicts arise as a result of change. Often service levels drop, sales falter, production problems deepen, and profitability wavers. It is critical that leaders have the determination to see change through. We can be tempted to throw up our hands and say, "That's it! We're going back to the way it was. Nobody is doing what we told them to do!" Don't mistake your own perceptions for reality. People are finding a new way to accomplish their goals. One that is more dependent on their efforts rather than their leaders support. Conflict is not necessarily bad. Conflict produces change, a reorganization of priorities and self sufficiency.

Stage 5: Fruition
No change is easy. But achieving long-sought-after goals is rewarding. Once a targeted goal is reached, success often begets success. This is the time to reward people for their success. Reward in public and punish in private. The great Dale Carnegie said, "Praise the slightest improvement and praise every improvement. Be hearty in your approbation and lavish in your praise." Also, put your money where your mouth is. Give performance bonuses based on achieving specific goals

Conquer Fear

Are You Waiting...

for someone to lead and inspire you?
for the boss to recognize you?
for clients to thank you?
for coworkers to help you?
for prospects to find you?
for the world to hail you?

Well here's a news flash.... They are all just sitting there waiting for you.

Someone recently asked me, what I felt was the biggest challenge for marketers today? My answer was complacency. Websters dictionary defines complacency as contentment and self satisfaction. You might say, "Hey hold on there Deo! Isn't that what we are striving for as entrepreneurs and small business owners? Shouldn't it be our ultimate goal to be content and satisfied with our business, finances, family and life?"

I say, NO.

When we become content and satisfied, we no longer have any motivation to get better.We drop our guard. We become OK with achieving the minimum. Unfortunately in today's competitive environment achieving the "minimum" in the short term may just not be good enough to "survive" in the long term. This can be very dangerous in the fast paced, high risk, volatile economy of the 21st century. You may be thinking, "that sounds a little scary, Mark."

It is.

Many people today are saying that fear is bad. I agree that too much fear can be debilitating, just as a complete lack of satisfaction can create disappointment and disillusionment. There are no absolutes. But if we completely eliminate fear from our lives, we lose some of our most base instincts. Think about when you first started your business or your first day on the job. Weren't you a bit apprehensive? Didn't you have some fear? You probably found yourself asking questions like, what if this doesn't work? What will I do if I fail? What if my coworkers or clients don't like me? Can I really compete? Do I really have the skills necessary to succeed at this?

I think you would agree that this is the GOOD kind of fear. The fear that drives us to greater levels of performance. Fear that motivates us. It's the kind of fear that makes us have more apprehension for things staying the way they are rather than bringing about change.

What does this have to do with marketing, you might ask. Successful marketing must allow us to significantly differentiate ourselves from our competition. We need to look different, sound different and be different. We need to go beyond the expectations of our clients and prospects. We must be willing to always be a bit uncomfortable with the way things ARE if we want to change. We can not be content with waiting for change. We can not be satisfied with the most comfortable option.

Here are some very specific things that you can do to make fear the friend that you consistently court, rather than the foe that you chronically avoid:

1. When things look bleak don't deny reality, accept it and begin to develop some options. Write them down and take action to change things rather than waiting for them to get better.
2. Don't allow yourself to be forced into change. Make the decision to bring about change BEFORE you are swept-up in the maelstrom.
3. Find someone that you can mentor. Taking this leadership role with even just one person will allow you to see the power of fear and change in another person. In the end, this will make it much easier for you to cope with fear and embrace change.
4. Look for situations where others are positively dealing with fear and change. Give them the recognition they deserve for coping with their changing environment. This will reinforce your own values.
5. Change the way you celebrate achievements.Typically, we set goals, we work hard at achieving them, we reach them and we celebrate. We are content and satisfied with a job well done. Hopefully when the party's over we set new goals and the cycle starts all over again. But shouldn't we be setting new goals BEFORE we pop the cork on the Champaign?
6. Be an evangelist for your company, product or service. Ask yourself, how YOU change peoples lives for the better. Focus on this. NOT features and benefits.
7. Be a catalyst for change with everyone that you meet. Look for ways that you can help them to cope with the fear and change in their lives.
8. Don't try to eliminate all stress in your life. Like my old boss, Sue Schneider used to say, "Stress is good, DISTRESS is bad." If we try to completely eliminate stress and fear in our lives we will be sadly disappointed. On the other hand if we find ways of coping with stress and fear, we will amass for ourselves resources of great value.
9. Be the first. Decide from this day forward that YOU will be the first to initiate change in your organization and even at home. You will lead and inspire. You will give compliments and provide recognition. You will thank your clients and vendors. You will lend a hand to help fellow workers. You will seek prospects whose businesses and lives can be improved by your company, product or service.

Business Success Quick-Tips

This week, we wanted to provide you with three quick tips that can help your business and expand your thinking. They revolve around your cash flow, thinking non-traditionally, and becoming a master at collaboration.

1. Know your cash position at all times! More important than your profit and loss statement is your cash flow statement. Many companies can operate at a loss for years if they're able to manage their cash flow. Know your projected flow at least 3 months from now. If you have a solid grasp on your income and expenses, you have a much higher chance of survival!
2. Think non-traditional sales and marketing. Most advertising does not work. Think of your last encounter with a salesperson. Traditional selling often pushes more people away than it attracts. Use the Internet, search engines, affiliates and alliance relationships to effectively build your business rather than running ads.
3. Become a master of collaboration. You may not have the right answer or solution for your clients but chances are someone within your organization or within your sphere of influence DOES. When we collaborate we broaden our expertise and are able to deliver more effective products and services to our clients.

Listen to the Small Business Hour this Friday at 4 pm PST. We will be interviewing Dr. Brad Smart, author of the bestselling book: Topgrading. He will be discussing how to attract and retain 90% "A players" in your company, eliminating unproductive workforces. In addition, we will have our Marketing Corner, Leadership Lesson, and much more. This will be an exciting show! If you can't listen live, you can listen to a replay at any time online. Go to www.smallbusinesshour.comto tune in.

A Four Letter Word

One late autumn evening a father came into his home with a small gift, which he partly concealed in his hands. Before his two sons could see what it was, he tossed it into the air. Instead of falling to the floor, as expected, it flew across the room till it struck the ceiling, where it fluttered awhile, and finally sank to the floor. It was a little toy, known to scientists of the time as a "helicopter." It was so delicate that it lasted only a short time in the hands of the two small boys, but its memory was abiding.

Later in the late 1800s the boys faced difficult economic times, fierce competition in the bicycle business (they couldn't give them away), not to mention being the laughing stock of all of Ohio. But in 1904 they revolutionized the world by creating the first flying machine. They were willing to risk ridicule. They were willing to risk the very high likelihood of failure. They were willing to risk profitable careers and pursue a hobby that started with a childhood toy! Yet if not for the risks they embraced, our world would be a very different place today. The boys were young Orville and Wilbur Wright.

I will always remember visiting the Edison Tower in Menlo Park, New Jersey where I grew up as a child. At the top of the tower is a replica of Thomas Edison's workroom. It is filled with all kinds of inventions, most of which are, to this day, useless artifacts. While in Menlo Park, Edison received over 400 patents on items, which were never put into production. In short they were failures. But Edison thought of these disasters as learning opportunities.

One time his lab stove went out in the dead of winter. Many expensive chemicals froze. Another time unprotected chemicals were damaged by sunlight. Instead of feeling sorry for himself, Edison stopped all other projects and thought of ways to solve the problem. He learned to change the makeup of some of the chemicals. He was not afraid to take risks and he never gave up when a project failed. Few people know that Edison started hundreds of companies between 1868 and 1928. Most of them were failures. But he would brush himself off and start something new. Edison learned that risk-taking was a good thing. He learned that without taking risk he could not achieve success. He learned that it's okay to fail. That failing is not the end. It is rather a new beginning

When did RISK in our society become a four-letter word? Maybe it was after the dot-com implosion or the tragedy of 9 -11 or the Enron debacle. Whatever the reason, "risk" has become a dirty little four-letter word in our business culture today.

A few weeks ago I talked about how we should go "one step beyond" with our business initiatives. It takes the commitment to exceed the performance of yesterday to succeed tomorrow. But it also requires that we be willing to take reasonable or even sometimes unreasonable risks. Was it reasonable that the Wright brothers would create a machine that could fly in 1904? Was it reasonable for Edison to say in 1876 that, "in the future electric light will be so cheap that only that wealthy will be able to afford candles?" Likely not. Both Edison and the Wright brothers knew that without risk, there is no reward. Are we any different today? Can we really afford to hunker down and take a "wait and see" attitude when technology, the marketplace and the world around us changing faster than ever before? I think not.

As I have said in the past, playing it safe isn't necessarily playing it smart - even in cautious times. Don't be afraid of risk. To not take a risk is to risk being ignored. "Destiny is not a matter of chance, it is a matter of choice. It's not a thing to be waited for, it's a thing to be achieved." Let's go from a "risk aversion" business culture to a risk sharing and reward innovation culture.

In short, risk-taking is as much a part of good management as smart product development, effective marketing and strong leadership.

15 Recession Proof Strategies

In a previous article I talked about how we need to get back to basics by adding value for our clients. I mentioned that I would be discussing the specifics of HOW we can do this at my all-day entrepreneurial workshop. As a result I received a number new registrations for the workshop, but I also received a few emails from people asking for more specifics about the content of the workshop.

The 5 Recession-Proof Management Strategies

1. Have a Clear Destination 
Develop an exit plan first. This will help establish long, mid and short-term goals Decide on what you will do to proactively position your product or service this year. Have a plan to finance new initiatives and contingencies if you don't get the cash If you're a start up, have a professionally developed written business plan with quarterly goals that you can review in just 15 minutes every week.

2. Do the Job of 2 People in Half the Time 
Do the most difficult things first. Do two things at the same time whenever possible Set aside time specifically for "planning your time." Balance the various activities in your life based on their importance to you.

3. Put Everything in Order 
Establish a place for everything and always keep everything in that place Make kinetic economy work for you. This is the process of accomplishing the maximum amount of activity by expending the minimum amount of energy. Make a commitment to improve your organizational skills Establish systems and hold people accountable to working within them.

4. Automate or Stagnate 
Calculate your rate of pay by activity. Are you paying yourself $100/hr to perform secretarial functions? Enjoy the efficiencies of off-the-shelf technologies like ACT!, Goldmine, Outlook, QuickBooks, Filemaker, etc. Put in place automated electronic solutions that will save you time and money. Use the Internet to gain efficiencies like online inventory reconciliation, credit card and check processing gateways.

5. Outsource and Delegate 
Make sure that your outsourcing plan ensures residual profit, productive efficiencies and added value for your customers Decide on a delegation management, exclusivity, royalties and compensation strategy UPFRONT. Tie alliance-partners into the client's ultimate goal and establish a system of accountability. Take the time to understand their participation and have a contingency to get the job done in a pinch.

The 4 Recession-Proof Financial Strategies

1. Don't Get Bought Cheap
Develop and stick to a firm pricing strategy and don't be afraid to communicate it with confidence. Understand your competition, why they exist and why their customer's prefer them over you. Know when to walk away. Know your profit margin by product, service and customer.

2. Make Cash - KING! 
Learn why the biggest reason businesses fail is because of cash flow. Develop a system to understand your cash flow on a weekly basis. You may be profitable, but if you are cash poor the party's over. Develop a 6 month cash flow forecast that you can view DAILY so you always know where you stand. Plan for and track EVERY expense and conservatively estimate your income in your cash management system.

3. Reserve Planning 
Develop "cash contingencies" and have a cash back-up plan for 6 months at all times. Establish a separate investment and bank account to plan for specific business and personal reserves. Develop an operating budget and live to it. If you have department heads establish the budget WITH them and hold them accountable to performance weekly. Establish a reserve for planned initiatives like marketing campaigns, expansion, capital equipment and so on. Limit "leveraged" expansion in the early stages but take advantage of attractive finance options as your credit history improves.

4. Plan to Pay Yourself Back
Put a price on your exit and start a reserve to facilitate it as early as possible Invest in your future. Focus on initiatives that build equity as well as "cash cows." Have a diversified investment strategy and communicate with more than one investment counselor Develop a residual income stream.

The 6 Recession-Proof Marketing Strategies

1. Be a Giver 
Understand why your customers are more selective than ever before. Use informational marketing to your benefit. How will you repetitively deliver your message yet include value for your clients? Decide on a media or mediums that you will use to deliver your message.

2. Out-Market Your Competition 
Be different - Count the ways that you will you set yourself apart from the competition.

Talk louder - Not in an obnoxious way but in an authoritative way. How will you establish authority?

Focus your reach - Why its better for you to be more important to fewer people than just another option for everyone. Be an evangelist for your business and industry

3. Be an Influencer NOT a Salesperson 
Develop a unique selling proposition for your business, product or service - something ONLY you offer. Talk less and ask more preplanned, directive questions when speaking with customers. Focus on WHY your customers need the benefits of your product or service rather than just the specific benefit they will receive. In other words: how will you change their life? Don't be too anxious to tell people why you are better. Find creative ways to make them come to that conclusion on their own.

4. Communicate Consistently 
Have a system of contact archiving, reporting, and management. Make using some kind of contact management system a daily habit. Craft a provocative, inspirational message to be delivered to clients and prospects in a unique way. Be creative and proactive in developing "reasons" to communicate with your customer.
 

5. Use the Web to "Touch" your Customers
Develop a personalized web presence. Make it a reflection of WHO you are rather than just WHAT you do. Make your web site more than just an on-line brochure. Include content such as educational information and valuable advise from experts in the field. Build-in some interactive value-added features like an exclusive member's area, chat room, forum postings, on-line reports and weekly or monthly newsletter Incorporate e-commerce features such as an on-line store, order tracking system, and purchase history features.

6. Extend Your Reach 
Develop a profile of potential collaborators. Identify at least 5 non-competitive partners that you can collaborate with and a pre-approach plan. Pick only the very best people in each area. Be very selective. Do NOT compromise on values or philosophy.  Ensure that there is mutual benefit. A one sided relationship will only breed resentment and contempt.

These 15 recession-proof strategies can transform your business, capture greater market share, improve your profitability, help you start a new business and reduce your financial risk in this difficult economy. But they are just NICE IDEAS until we put them into action.

Also give yourself every opportunity for success this year. Check out our web site for our next Entrepreneurial Workshop and get pre-registered. If nothing else I guarantee that it will be a great way to start the year with a positive first step.

Those of you that have attended any of my classes know that they are energy packed and you walk out motivated and cranked-up! You DO NOT have to be the victim of a "slowing economy," an "economic downturn," or what the media calls a "recession."

Lemonade From Lemons

Coming back from a nice day at the beach recently my wife spotted a lemonade stand by the side of the road. The stand was operated by two young children around 10 or 11 years old. We were a little thirsty so we decided to stop and get a drink. As we pulled up to the stand we could see the excitement in the kid's eyes. They scampered to and fro to prepare the cups of lemonade for two more customers. "Ice or no ice," the miniature salesperson asked me. I gave the child a buck, which included our standard 50% tip.

They carefully poured two glasses of icy drink and lovingly placed a slice of lemon in each of our cups. These kids were thrilled to be able to act as little entrepreneurs. I looked over at the father of one of the children. He obviously was the chaperone for the day. Even he was animated and full of life. He smiled, welcomed us and even thanked us for stopping by. As we left, two more cars were pulling-up and the kids were frantically fixing another pitcher. Our drinks were finished by the time we got to our car but the pleasant warm feeling was with us for the rest of the day.

I couldn't help but think: "If only ADULT entrepreneurs could be as enthusiastic about their business as these kids were about a little lemonade stand." That's when it hit me. WOW! That's it! The reason Kathy and I always stop at these lemonade stands isn't because of the cold drink or the cheap price or even the blessing we might bring to the children. It's because of the way it makes us feel.

Those kids love being lemonade merchants and it shows. They are passionate about making people happy. They feel great about what they are doing and consequently we feel great at being part of their adventure. We are attracted to them because of their sincerity, passion and integrity. It's not about the product, service or the money.

Today people are facing difficult circumstances. They are struggling to make payroll. They are seeking to replace lost business. Almost a year later, many are still dealing with the aftermath of September 11th. Most of us are working diligently on delivering a better product or providing improved service or even trying to do both at a cheaper price. Many are looking at ways to increase profit so they can survive and grow. I say this is only a very small part of the solution.

Chances are your competitors are offering a product or service that is very similar to yours if not indistinguishable in every way. It may even be cheaper than yours. If this is so, then how can we get an edge over the competition? By becoming focused on making customers FEEL good about being involved with our product or service.

We live in the most extraordinary economic period in history. As a result we must take extraordinary measures to ensure our success. This means learning how to attract people to us. Business is about relationships. Whether we're looking to attract business partners, customers, or talent, we must understand that people look closer at WHO we are rather than WHAT we do. This is as true for multinational companies as it is for single practitioners. Why has every business associated with Enron divested themselves of that relationship? Surely not because of poor product performance or substandard service or even low profit potential. The fact is that Enron's product, service and profit potential has been excellent. Yet based on "who they are," no business partner in their right mind would align themselves with Enron at this point in time.

I'm not talking about taking the high moral ground or being a lily-white ethical leader in your industry. I think that discussion been blunted over the last few months by just about every political, economic or social pundit of our day. My point is that we need to create passion in our business as much as we look for ways to improve profit. Here are some "passion creating" ideas that I know will attract the right kind of customers and partners to your business:

1. Be crystal clear about the vision for your business. I get physically ill when I come into a company and the CEO hands me their mission statement. Remember that your DESTINATION is far more important than your mission. It is the end result that motivates and excites people.

2. Seek business relationships that add value to the customer interaction. These are likely to include what I like to call "relationship enhancements." These are variables that are more important to customers than they are to the bottom-line. They could also be relationships that provide access to valuable technologies or complimentary (not competitive) product offerings.

3. Rally your people around the guiding principals of your business. Focus not so much on teaching your people "what" to do but rather "why" you do it that way and how it has strengthened business relationships in the past.

4. Expect more from your people. Hold them to a higher standard. No organization can survive and grow without a system of accountability. As business leaders we are accountable to customers. Our team members must also be accountable to specific duties, responsibilities and levels of performance.

5. Impose your values on others. This goes against the grain. Most would say we DON'T have the right to impose our values on others. The fact is that all we really have is our values. Any job can be taught but can we really teach reliability, honesty, enthusiasm, integrity and so on? Does that mean we should only expect that from certain team members? I say we should hire people based on value consistency and fire them for value inconsistency.

6. Be open with information. Successful people are information hounds. They are always hungering to know more. I believe the more your customers and partners know the more you will be able to incite passion and differentiation.

7. Differentiate not just your product selection, service delivery or profit potential but the emotional quotient in business relationships. Get to the heart of how people feel about your business, product or service. We can't MAKE people feel a certain way we can INFLUENCE the way they feel based on our actions.

What are you doing to attract more customers to your business? I hope it's more than just providing an excellent product, spectacular service or a great value. For these are no longer enough. They can be easily replicated by your competition. Improving relationships is the key element in attracting customers and partners today. You may feel that this easier said than done.
There are however techniques that can be employed to help to build and strengthen relationships.

Paralyzed by Fear

Are You Waiting...

for someone to lead and inspire you?
for the boss to recognize you?
for clients to thank you?
for coworkers to help you?
for prospects to find you?
for the world to hail you?

Well here's a news flash.... They are all just sitting there waiting for you.

Someone recently asked me, what I felt was the biggest challenge for marketers today? My answer was complacency. Websters dictionary defines complacency as contentment and self satisfaction. You might say, "Hey hold on there Deo! Isn't that what we are striving for as entrepreneurs and small business owners? Shouldn't it be our ultimate goal to be content and satisfied with our business, finances, family and life?"

I say, NO.

When we become content and satisfied, we no longer have any motivation to get better.We drop our guard. We become OK with achieving the minimum. Unfortunately in today's competitive environment achieving the "minimum" in the short term may just not be good enough to "survive" in the long term. This can be very dangerous in the fast paced, high risk, volatile economy of the 21st century. You may be thinking, "that sounds a little scary, Mark."

It is.

Many people today are saying that fear is bad. I agree that too much fear can be debilitating, just as a complete lack of satisfaction can create disappointment and disillusionment. There are no absolutes. But if we completely eliminate fear from our lives, we lose some of our most base instincts. Think about when you first started your business or your first day on the job. Weren't you a bit apprehensive? Didn't you have some fear? You probably found yourself asking questions like, what if this doesn't work? What will I do if I fail? What if my coworkers or clients don't like me? Can I really compete? Do I really have the skills necessary to succeed at this?

I think you would agree that this is the GOOD kind of fear. The fear that drives us to greater levels of performance. Fear that motivates us. It's the kind of fear that makes us have more apprehension for things staying the way they are rather than bringing about change.

What does this have to do with marketing, you might ask. Successful marketing must allow us to significantly differentiate ourselves from our competition. We need to look different, sound different and be different. We need to go beyond the expectations of our clients and prospects. We must be willing to always be a bit uncomfortable with the way things ARE if we want to change. We can not be content with waiting for change. We can not be satisfied with the most comfortable option.

Here are some very specific things that you can do to make fear the friend that you consistently court, rather than the foe that you chronically avoid:

1. When things look bleak don't deny reality, accept it and begin to develop some options. Write them down and take action to change things rather than waiting for them to get better.

2. Don't allow yourself to be forced into change. Make the decision to bring about change BEFORE you are swept-up in the maelstrom.

3. Find someone that you can mentor. Taking this leadership role with even just one person will allow you to see the power of fear and change in another person. In the end, this will make it much easier for you to cope with fear and embrace change.

4. Look for situations where others are positively dealing with fear and change. Give them the recognition they deserve for coping with their changing environment. This will reinforce your own values.

5. Change the way you celebrate achievements.Typically, we set goals, we work hard at achieving them, we reach them and we celebrate. We are content and satisfied with a job well done. Hopefully when the party's over we set new goals and the cycle starts all over again. But shouldn't we be setting new goals BEFORE we pop the cork on the Champaign?

6. Be an evangelist for your company, product or service. Ask yourself, how YOU change peoples lives for the better. Focus on this. NOT features and benefits.

7. Be a catalyst for change with everyone that you meet. Look for ways that you can help them to cope with the fear and change in their lives.

8. Don't try to eliminate all stress in your life. Like my old boss, Sue Schneider used to say, "Stress is good, DISTRESS is bad." If we try to completely eliminate stress and fear in our lives we will be sadly disappointed. On the other hand if we find ways of coping with stress and fear, we will amass for ourselves resources of great value.

9. Be the first. Decide from this day forward that YOU will be the first to initiate change in your organization and even at home. You will lead and inspire. You will give compliments and provide recognition. You will thank your clients and vendors. You will lend a hand to help fellow workers. You will seek prospects whose businesses and lives can be improved by your company, product or service.

I hope this helps you to begin see fear as a friend and change as the precursor to growth.

The Death of Corporate America

Remember the old days?

Our fathers and grandfathers worked for the same company for 20, 30 or even 40 years. Generations of sons and daughters toiling under the protective arms of the "COMPANY." 

Today it's more likely that we will outlive any organization that we work for. 

It has snuck up on us. We turned our head and all of a sudden Corporate America is dying. 

It is the result of a powerful force that has emerged in our society. Not a company or a new technology or even a new industry. It is the evolution of workers themselves. For the first time in history, there are more workers operating as "free agents" than there are people working for Corporate America. Fortune 500 companies no longer form the bedrock of our workforce. 

How Has This Happened?
This evolution has been rapid and decisive. It has occurred for a number of reasons. First, the social contract of job security has long been broken. Jobs are no longer sacrosanct at Fortune 500 companies. One day these firms are in expansion mode and the next they're "laying off" 35,000 workers. Second, e-commerce and automation technologies have leveled the playing field so that smaller companies with less people could provide the same benefits as larger multi-national firms. This resulted in corporate re-structuring and downsizing. And finally the loyalty/security pact of the previous five decades has been broken. This was evidenced in the mid nineties when IBM broke it's "full employment policy" by reducing it's payroll by a whopping 120,000 employees. In this century, being loyal to a company does not guarantee job security.

What Does The Future Hold?
Today the largest private employer in America is not Ford, General Motors, or even Microsoft. It's Milwaukee's Manpower Inc., a temporary help agency with over 1,100 office throughout the United States employing over a million workers. Temporary staffing has grown from a $1 billion industry to more than $80 billion while employing over ten million temps nationwide. It is estimated that there are over 33 million solo, self-employed workers. And there is an emergence of a new category called micro businesses. These are small businesses employing just 2 or 3 people to drive particular initiatives on either a full or part time basis. In fact, more than half of today's companies have fewer than 5 employees! Don't look to our government to reconcile this societal evolution. They're a full century behind. The Bureau of Labor and Statistics still divides all workers into two categories: farm and "non-farm." Figure that out. 

What Free Agents Love
The work ethic of free agent entrepreneurs is considerably different than corporate employees. These entrepreneurs crave, freedom, control, security, and loyalty. If you think about it, these are the very job benefits lacking in Corporate America. Today free agents come in a variety of forms, entrepreneurs, independent contractors, consultants, advisors, 1099ers, hired guns, nomads, etc. But their focus is on producing a measurable result for an organization rather than performing a specific role within it. Free agents tend to provide a higher return on investment for organizations because of their accountability to themselves rather than to a hierarchy.

Freedom
Freedom is the ability to exercise one's own will. Within the corporate cocoon freedom takes on the meaning that the company as a whole projects. Some companies smother their employees in affection others try to purchase individual freedom with stock options and incentives. Free agents can choose to follow their own work ethic. This extends not only to what they believe, what they do and where they do it but also WHEN they do it. Free agents have succeeded in melding work time with home time. Gone is the Monday through Friday 9am to 5pm ritual. Today they balance a full time home life with a full time work life.

Control
Life in Corporate America is about lining up behind the company culture and philosophy. Free agents can control their own destiny. Consequently they develop skills in areas which they desire to excel. They build relationships with those that match their business culture and paradigm. They focus on selling insight, talent, expertise, ideas, creativity and solutions rather than just performing tasks. They realize that what matters in the course of a day is what is accomplished not how many hours are worked.

Security
The last decade has been one of prosperity. Members of Corporate America had job security but that prospect is diminishing. While a high standard of living has reached deep into middle class many members of Corporate America do not feel that their lives have improved. This dichotomy has altered our expectations of comfort and prosperity. People are looking forward to more than just a comfortable retirement after four or five decades of "work." People are realizing that it's not good enough to work to make money and survive. They desire to work to make meaning for themselves and their families. 

Loyalty
With free agents loyalty does not run up and down an organizational chart. It runs from side-to-side in allegiance to clients, colleagues, teams, projects, vendors and industries. In this sense free agents are far more loyal than company men and women. Companies can also afford to be more loyal to free agents because they lack the overhead that employees bring. Both benefit from the free agent structure because whereas vertical loyalty within an organization depended on one connection (boss and employee) this new horizontal loyalty depends on many connections.

How It Impacts YOU!
In the end I believe that we will see the free agent philosophy infiltrate every industry, profession and area of expertise. Those that are most prepared for this transition will benefit the greatest. Think about your own business. How could you use the "free agent mentality" to bring efficiencies to your business? If you're an employer, how could you increase productivity and reduce overhead by employing free agents? If you're an employee, how could you deliver greater production to your employer and increase your earning capacity by utilizing the above free agent infrastructure?

Team Innovation

Today, businesses large and small like to say they are "team oriented" (whatever that means). I guess it means they work in teams. Big deal. Does that improve their performance? Does that mean that the quality of their product or service is better than the competition? Does that allow them to complete a project more timely, profitably or effectively? Is teamwork really a better way to go about solving problems than say the "hermit" approach? What about Thomas Edison or Leonardo DaVinci or Alexander Graham Bell?

If you've ever worked on a team you know there is one thing that can not be avoided: CONFLICT. At some point someone is going to disagree with somebody else and then, look out! Getting to a simple solution can take hours or days while these two "team-members" fight over minutia. Sound familiar?

Let's face it, often times, teams can hit roadblocks that can sabotage their success. There are a number of things that can be done to ensure good teamwork:

Conflict is Good

As team leaders we must not allow ourselves to think that we solely carry the burden of resolving conflict. I see so may managers, owners and team leaders rush to squish the most subtle sign of conflict within their team. Without conflict we can not reach the best solution. This also places us in a patronizing, parental position that encourages your team members to abdicate personal responsibility for resolving conflict. It keeps them from developing the skills to necessary to grow, mature and hold each other accountable. Allow the team to detect conflict and manage only those that escalate.

Guidelines for Managing Conflict

As leaders we need to model guidelines that set the tone for resolving conflict. In this way we will be educating our team members to take responsibility. These should include:

• No personal attacks
• No heated outbursts
• No backbiting
• No hostile assumptions

Establishing Expectations

Over the years I have noticed that communicating expectations to the team is paramount in achieving exceptional team performance. The following are areas that team leaders should develop clear expectations for members:

1. Work methods - Make sure your team knows the methods and procedures you expect them to follow when completing the job. If they do not they may frustrate themselves by taking the "long route" and end up disillusioned.

2. Deadlines - Make sure that the team fully understands the time frame for completion. This should include non-negotiable dates as opposed to to dates that can slip.

3. Responsibilities - Ensure that every team member understands their role in the team process. This should be communicated one-on-one with each team member prior to establishing the team. Also ensure that the team members responsibilities are consistent with the teams responsibilities.

4. Priorities - It is critical that team members know the proper priorities. What's to be done first, second and so on.

5. Performance - Paint a picture of the outcome for the team. Show them a vision of a "good" job vs. a "bad" job. Make sure they understand the degree of effort that you expect them to each contribute to the successful solution.

6. Measurement - Establish a system to measure performance in small increments.

7. Communication - Establish a format for consistent communication with the team. This forum will give you the ability to ask the right kind of questions to determine whether the team is "on-track." At this pint you can provide feedback to the team and make suggestions on course correction.

8. Resources - Make sure that your team members understand the resources that are available to them. This could include staff, facilities, technology, equipment, outside consultants and so on. Encourage them to use the resources to their best advantage but in a cost effective way in order to achieve their goals.

As leaders it's our job to foster innovation. Team members look to us for confidence, guidance, direction and innovation. What can you do to set the stage for creative thinking in the teams that you lead? How can you get your team to discover the best solutions in the most cost effective manner. Remember teams are not just resources, they are people. As I have said many times, we line in an age of relationships. How can you create relationships that go beyond just getting the job done. How can you create relationships that can produce the kind of Edison, Bell and DaVinci innovation.

Office Politics

Someone asked me the other day: "Mark what do think is the biggest challenge for small businesses today?"

I didn't have to think about this very long. I know they were expecting me to say something about: the affects of the economy or the stock market or the impact of technology or the lack of funding or resources or even the breakneck speed which we are expected to operate at.

But the reality is that these are relatively minor forces when compared with the most powerful force of all:

Office Politics!

If you could walk with my consultants and I, in and out of businesses we each see everyday you would see the obvious yet devastating result of office politics. I believe it is by far the biggest obstacle to change and growth for companies today. Not that this is new. Office politics has been with us for decades. But the changing financial, political and social landscape makes it more insidious than ever and literally threatens the survival of many small businesses and even larger organizations.

Why? Because of the exorbitant cost associated with office politics.

The cost of office politics is a kind of activity-based cost. It includes time lost, waste of resources, low staff morale and ineffective delegation. Some of these costs are tangible but not accountable. Often time this kind of loss is ignored or neglected. Since many political activities are cross-departmental, office politics can render an organization completely dysfunctional in a very short period of time. While it is usually unwise to let office politics freely develop, unfortunately many companies cannot tackle such a political problem and let it erode their productivity and profitability and sometimes even endanger their survival.

Office politics is about the application, distribution and negotiation of power and resources in an organization. This power includes authority (formal power) and influence (informal power). Politics is basically the application of that power. The desire for power is determined by one's personality. Leaders can affect this principal in every organization. Strong, ethical leadership regulates the application of informal power (i.e. influence) to avoid the overuse and abuse of authority. Abuse of authority will lead to a chain of negative effects such as low staff morale, conflict, bias, bad image, poor communication, dishonesty and social conflict.

When ethical leadership exists, office politics will abate. This is because ethical leadership is essentially self-management and self-control as an example for subordinates to follow. It is the strongest influence for change in any relationship. As I've said before, leaders act the way they want their team members to act. Cultural actions cannot be ordered or commanded. Most political office issues are symptoms of weakness at the senior management and organization level.

While every organization is different, most have some type of definable culture. Some call this the organization design. It is essentially referring to the general distribution and structure of authority, responsibilities and resources in the organization. Poor organizational design is a common cause of office politics because ineffective organizational structure allows too much room for the negotiation for authority and resources.

The organization chart in the business leader's mind is far more important than the official one. Ricky W.O. Lau, author of Politics in Business calls it the "hidden organization chart." Often times this means that the leader has bias and personal favor to individual members but does not act openly and his delegation is based on the hidden organizational chart rather than the official one. This is a common yet unfair and very detrimental management practice.

While delegation is the distribution of specific work, responsibilities and authority, in an effective organization, delegation must be based on the organizational structure. Otherwise, there would be structural overlap, confusion, conflict and politics. Conflict usually involves different interests of different people (especially in different departments). Conflict may be minimized if the focus is on the whole organization rather than individual department or individuals. Some management styles may easily lead to office politics because the focus is on the performance of individuals and departments rather than the organization as a whole.

Certainly interdepartmental conflict cannot be completely eliminated. Nor should we attempt to do so. It is important to remember that disagreement is not equivalent to conflict. People may disagree or criticize others if:

1. They view the matter from another viewpoint
2. They have misunderstood other's meaning
3. They want improvement
4. They want to challenge others' position or power.

Out of the above four motives of disagreement, only the last one is the result of conflict and is a political motive. However, when a manager is too politically sensitive, he may mistakenly treat the first three motives as political motives, and interpret the conflict as an intention to challenge his position or power.

Desire of power may be a strong motive to perform, but it may also lead to a negative and destructive result. An effective manager should apply his influential power rather than authority because abuse and overuse of authority can lead to poor relations, distrust, misunderstanding and disorganization.

Are office politics an issue in your business? If any of these symptoms are present in your business, its time to think about making some core changes to your business culture. At the Small Business Advisory Network we like to say that we influence decisions, improve performance and inspire change. That's what our consulting, workshops, web site, weekly articles and The Small Business Hour Radio Show are all about.