Bad News Bears

Uh-oh. Jack just learned that he did not win a contract that was supposedly all but certain. He was counting on this deal to make his quota and had been bragging to the vice-president of sales and his co-workers that it was in the bag. What’s more troubling is the fact that he’s been under the gun by upper management over the past few months to improve his production. Now what?

Jack has to deliver the bad news. The first thought running through his head is that he’s going to be fired on the spot. He’s deep in debt and has a wife and two small kids at home. What does he do? Unfortunately, Jack chooses to do what so often happens in situations like this. He fudges the truth. He tells his boss that he hasn’t yet “heard the final word” from the client. Jack holds onto a thread of hope that he might be able to salvage the deal.

It’s obvious that delivering bad news is never fun. It actually starts with an organization’s culture. What is the reaction to bad news by the leadership? Is there screaming, yelling and threats? How about chaos and recriminations? If so, this sets the tone for anyone on the wrong side of having to report unfavorable results. It’s human nature to try and avoid painful encounters of this sort. Thus, some people may have a tendency to stretch the truth, fudge the facts or outright lie about the situation, rather than endure the wrath of the boss.

In a healthy organization, delivering bad news is just another routine task to be performed. The enlightened leader will encourage team members to openly talk about what isn’t working including setbacks that have recently occurred or are anticipated. He or she will work with the team to understand what went wrong and how to avoid a similar result in the future. There’s no negative emotion or drama associated with this analysis. In so doing, team members feel safe in bringing news of any sort – good or bad.

A leader who operates in a fair and even-handed manner is entitled to expect full and total integrity from the team. The team member in a healthy organization who fudges the facts like Jack did should be dealt with in a severe manner. Here’s the calculus. I won’t blow up and make you feel lower than whale poop, and you owe me complete transparency. It’s as simple as that.

If you are part of an organization that struggles with bad news, first look inward and remember that it’s a two-way street. If the organization is unwilling to react in a calm and measured way, then it cannot expect team members to want to deliver bad tidings.

There’s another element to delivering bad news. It may be that the leader does not have an angry tantrum at all. This individual may always be very upbeat and optimistic. But members of his or her team may still not want to tell it like it is. Why? Because they don’t want to disappoint him. In many situations feeling like one has let down a co-worker or a leader is a powerful motive to duck or delay the inevitable. It’s circumstances like this where the leader must take care not to send any signals that he/she may be disappointed. In fact, this leader should go out of his way to encourage members of his team not to equate bad news with a disappointed boss.

One way to solve this dilemma is to embrace failure as simply a step in a process. A forward-thinking entrepreneur will model this attitude by sharing his or her failures with the team. Being vulnerable in this manner may encourage others to be more comfortable doing the same without fear of disappointing the leader.

Let’s replay Jack’s scenario with a different twist. Jack learns that he did not win the contract. He immediately goes to his boss and explains the facts of the situation. His boss says, “Jack, this reminds me of a situation a few years ago where I was positive I was going to win the brass ring only to be left holding the bag. But I scrambled together a radical new approach and took a long-shot by asking to see the client one last time. Believe it or not he changed his mind and I won the deal after all. You might try the same approach.” Maybe Jack went on to win the deal and maybe not. Regardless, there was no hesitation when it came time to deliver the bad news initially.

Delivering bad news can be done in a matter-of-fact fashion if an organization’s culture encourages it. If not, we can expect that people will take extreme measures to avoid this unpleasant task.

This blog is being written in tandem with my book, “An Entrepreneur’s Words to Live By,” available on Amazon.com in paperback and Kindle (My Book), as well as being available in all of the other major eBook formats.

The Entrepreneurial Delegator

Let’s look at two scenarios. A busy and stressed-out entrepreneur is on the run. He stops by the desk of a colleague and says the following, “I need some PowerPoint slides for a presentation about our XYZ product. This is a top priority – I need it ASAP.” Now, let’s contrast that with the same encounter but different characters.

A busy and stressed-out entrepreneur is on the run. She goes to the office of a colleague and sits down to explain what she needs. “We have an opportunity to make a presentation to the ABC Company for potentially one of the largest orders of our XYZ product ever received. We’ve been building a relationship with ABC for the past year and they called last night and said we could have 30 minutes on Tuesday. Could you please help me put together this presentation? I’m going to work on exactly what I’m going to say – would you be able to put together eight PowerPoint slides that show how the XYZ product is different than the top competing products? I’m wide open to any ideas you have to be creative here. I realize that this will require some juggling on your part – what is a reasonable timeline to get this completed? What can I do to help?”                                                                                                                                                     The difference in approaches isn’t hard to spot. In the first case, the entrepreneur performed the Dump and Run maneuver flawlessly. If Olympic judges were grading him, he would have nailed a perfect 10. In the second case, the entrepreneur used the Delegation technique. She too would have received high marks. So, if you were on the receiving end of this encounter, which of these entrepreneurs would you prefer to work with?

Dump or Delegate. Both start with the same letter but that’s where the similarity ends. Which is more efficient and effective? Some might say that from the entrepreneur’s perspective, handing off an assignment and quickly moving on to the next task is indeed efficient. And there’s no doubt that there are many things that simply can be “dumped” with a minimum of explanation. The problem is that some of us tend to make this the default practice rather than the exception. When I discussed this with another businessperson at some point in the past, he told me that “if my people aren’t smart enough to figure it out for themselves, then I have the wrong people.” I think I disagree . . . strongly.

Delegating work in a true sense requires collaboration. I’ve found the collaborative approach to be much more efficient and effective. Why? Because by spending the time necessary to bring others up-to-speed the chances for an error-free outcome increase substantially. Further, the odds also improve for a higher quality result. This happens because people are actually able to engage their brains in a much more comprehensive manner when they have a full understanding of the situation at hand. It stands to reason that if I just give someone a “snapshot” of what is needed without the broader context then I’m likely to get a narrowly focused work product.

Here are the steps I’ve found most productive when delegating to others.

  • First, I try to provide the whole story – not just snippets. In doing so, I’m showing respect to my colleague by making sure they have the same information as do I.
  • Second, I try to be as specific as I can about what I need. But I also encourage my colleague to be innovative to the extent the situation warrants. This sends a message of flexibility as opposed to rigidity. It also enables the colleague to “personalize” the finished product.
  • Third, I make sure my colleague understands the overall timeline. It’s important that the colleague understand when I learned of the assignment. How many times have we seen someone sit on a project then do the last-minute mad dash to finish in time? The last thing I want is for my co-worker to think I’m doing this to him or her. I also want my colleague to set the deadline for completing what I’ve asked to be produced. If his/her timing doesn’t work for the assignment, I can always negotiate a tighter date.

Our team grows stronger when we Delegate every chance we get. While it may take a little longer at the front end, the final result is usually much better than what comes from the Dump scenario.

This blog is being written in tandem with my book, “An Entrepreneur’s Words to Live By,” available on Amazon.com in paperback and Kindle (My Book), as well as being available in all of the other major eBook formats.

The DIY Entrepreneur

Are you a DIY entrepreneur? True confessions – I used to be but have worked hard to become “reformed” in this category. I’m not necessarily saying that the DIY notion is entirely flawed. In fact, there are very healthy aspect to being DIY. Based upon my own experience and what I’ve observed over the years, here’s the profile of a DIY entrepreneur.

In the earlier days of my career, I worked hard to become educated about my industry and all its intricacies. I learned how to replace a toilet, effectively lease apartments, deliver spot-on zero-based budgets and identify great talent. I could get deep in the weeds better than anyone. And this eventually carried through to whatever position I was filling at the time. This level of detail was productive in that I knew what needed to be done in nearly every instance. It also became a trap when I found that other members of my team were sitting back and taking the attitude, “we don’t have to worry about that. Lee will eventually take care of it.”

The DIY entrepreneur often fails to delegate. Sometimes its delegating key functions and at other times its simply anything at all. I can well remember the times that I’d prepare a complicated financial model or call a client because I believed the task could be handled more quickly (and much better) if I just did it myself. While this may have been true at that moment in time, there were other things that I also needed to do that were being pushed to the backburner. I finally realized that this aspect of the DIY entrepreneur was actually counterproductive. I was not prioritizing my time correctly nor was I contributing to the growth of other team members who were being deprived of the opportunity to learn how to handle the tasks I was hoarding.

I also learned that being a DIY entrepreneur was a massive roadblock to scaling our business. No matter how efficient I thought I was, there was no way that I – as one person – could grow a complex enterprise by myself. Further, one of our initiatives is to create a sustainable organization that lasts well beyond the current leadership and perpetuates for generations to come. Hundreds of families – thousands of people – depend upon our family of companies for their livelihood. Growing and scaling the business is critical to our sustainability. Eventually I had to let go of so many of the things that I had handled in the past and trust others to do so instead. I found this to be somewhat liberating . . . but also a bit scary.

Why was it scary? Because I had not previously invested myself in the coaching and mentoring process. This is a common characteristic of the DIY entrepreneur. I know the high-powered leader of another business who has been extremely successful. He’s my age and has done amazing things in his career. On the downside, he’s not a coach or a mentor. He yells and curses at members of his team. His DIY style is that of command and control. I have often wondered what will happen to his company when the day comes that he keels over from a stroke or heart attack. As I have become more and more of a “reformed” DIY entrepreneur, I have found that coaching and mentoring offers amazing rewards – especially as I watch others carve-out success in their own right.

Many DIY entrepreneurs are loathed to share the spotlight. The businessperson previously referenced is always the focus of news articles and industry awards. There’s no question that he’s very accomplished in his field. But rarely do I ever see him compliment those who work for and with him – especially publicly. It thrills me to see members of our team win public recognition. My role now includes being one of the biggest cheerleaders for others in our organization and I love it!

Finally, the DIY entrepreneur may find it difficult to admit mistakes. Why? Because the burden rests entirely upon him or her. When one is in this position, we think we know that our way is absolutely the right way. We aren’t about to seek advice from others and when things don’t work out as planned, we have a tendency to place the blame elsewhere. Perhaps asking others for their thoughts and ideas is a signal of weakness in the mind of the DIY entrepreneur. As a result, we plunge ahead fearlessly and tirelessly . . . right off the proverbial cliff. Entrepreneurs who are truly self-confident and comfortable in their own skin don’t have a problem admitting they screwed up. They welcome and embrace the counsel of members of their team.

If you are a DIY entrepreneur there is hope for you. The “reform” process involves learning to prioritize, delegate, coach, mentor, trust others, share the spotlight and be willing to admit mistakes.

This blog is being written in tandem with my book, “An Entrepreneur’s Words to Live By,” available on Amazon.com in paperback and Kindle (My Book), as well as being available in all of the other major eBook formats.

The (Stubborn) or (Persevering) Entrepreneur

Mules are interesting animals. They are a cross between a male donkey and a female horse. A mule is stronger than a horse and historically was used for heavy work in agriculture and timber. Mules are independent creatures and can be very obstinate and stubborn at times – hence the saying, “He’s stubborn as a mule.”

Tortoises are equally fascinating. They can live longer than 150 years and have hard shells that make them less vulnerable to predators. Tu’i Malila was the oldest tortoise on record, born in 1777 and died in 1965. If you’ve ever watched a tortoise, you know that they are slow, plodding reptiles. When they are presented with an obstacle, they find a way to go around it.

The metaphor for entrepreneurs is obvious. And notice that I’ve avoided the even more obvious example of the tortoise and the hare – that’s a whole different blog someday. Instead, the lesson here is about stubbornness vs. perseverance. As entrepreneurs, we are continually confronted with situations that require some level of perseverance. If we fail to persevere, we end up flitting all over the place and accomplishing nothing. But when does perseverance turn into stubbornness? Presumably stubbornness is not necessarily a desirable trait. The dictionary defines stubborn as “unreasonably obstinate; obstinately unmoving.”

The story of Milton Hershey is inspirational. He launched three candy companies in New York, Philadelphia and Chicago. And all three failed. Hershey moved back to Lancaster, Pennsylvania where he started another company that made a unique type of caramel. But he was convinced that chocolate was the wave of the future and sold his caramel business to start the Hershey Company. Of course, the Hershey Company went on to become a huge success in the milk chocolate business.

Was Milton Hershey stubborn, or did he persevere? Back to the dictionary which defines persevere as “to persist in anything undertaken; maintain a purpose in spite of difficulty, obstacles, or discouragement; continue steadfastly.” I believe Hershey epitomized the definition of perseverance. He had a vision. He was constantly tweaking and refining his products. He surmounted his obstacles and eventually became highly successful.

Stubbornness is evidenced when we keep banging our heads against the wall trying the same things over and over. And it’s not working. Suppose we have a business that is struggling to gain traction. We’re not making much money – maybe even losing money – and we continue to keep doing what we’ve been without making any material changes. Now that’s stubborn.

Let’s take that same example and overlay it with perseverance. The business has been struggling to gain traction. We’re not making much money – maybe even losing money. But we believe in the long-term vision and aren’t about to throw in the towel. Instead, we step back and analyze what we’ve been doing. We do the research necessary to identify refinements and adjustments to our approach. Perhaps we even make a major pivot. Think about the tortoise. He reaches an obstacle that he can’t go over. Does he keep trying to climb over it without success? No, he “pivots” and moves a different direction, eventually ending up achieving his vision – whatever that might be for a tortoise. Perhaps our business needs a different approach to marketing and sales. Maybe we need to eliminate a particular product and add another. Regardless, we must do things differently than we have in the past. We don’t quit. We aren’t a victim. We simply get better at how we play the game.

Stubbornness doesn’t require much brainpower. There’s a lot of wallowing that occurs. Perseverance is smart. The vision persists. The ideas flow. And success is ultimately achieved.

This blog is being written in tandem with my book, “An Entrepreneur’s Words to Live By,” available on Amazon.com in paperback and Kindle (My Book), as well as being available in all of the other major eBook formats.

The Humble Entrepreneur

My daughter, son-in-law and their brood visited a fairly affluent Sunbelt community recently. They saw a lot of luxury cars, expensive jewelry, pricey condos and homes along with some monster yachts. I asked my son-in-law what surprised him the most about his experience and his response was not what I expected. He had several encounters with obviously well-to-do people that were less than pleasant.

In one instance he was preparing to pull into a parking place at a tony shopping center and a man tried to bull his way into the same space. I witnessed the incident and my son-in-law clearly was in the right. Yet the man berated him for not ceding the parking spot. There were other instances where people were pushy, impatient and downright rude. My son-in-law is still learning how to take these kinds of situations in stride. Instead of ignoring the bad behavior of others he chose to retort with his sarcastic wit.

There are a couple of lessons here for entrepreneurs and everyone in general. One of the wonderful benefits of entrepreneurship is the opportunity to gain substantial material wealth. And as our bank account grows, we may want to enjoy the fruits of our labor in the form of an upscale lifestyle. Long ago I adopted the philosophy that the “bigger” we get the humbler we become. By “bigger” I am referring to wealth, success, power and station in life. In other words, I would never want someone to identify me from a socio-economic standpoint by the way I act.

Unfortunately, there are those who think that their ascension to the riches they have accumulated entitles them to inhabit a special place in society. Metaphorically speaking they think it’s their right to go to the head of the line. Graciousness gives way to boorishness and snobbishness. There’s a very simple way to combat this attitude and prevent it from happening to us. My formula goes like this – I look to the person on my right and the person on my left and realize that I’m no better and no worse than either of those individuals. And, nothing I’ve done and nothing I will do will ever make me any better. Our true bounty comes from within – not from external sources. How we treat others is far more important than the price tag on any of our possessions.

The second lesson is that of how to respond to the kind of behavior I previously described. It’s a natural human reaction to be a bit defensive when we believe someone is attacking us. We want to stand our ground, and perhaps we even want to walk away as the winner of the bout. Newsflash – there is no victor when we engage in tit-for-tat. Sarcasm or verbal jabs may produce a momentary feeling of vindication but to what end? Did the other person change his or her mind? Did we actually solve the problem?

How should we respond? After sixty some-odd years I still remember my mother’s advice to “be the bigger person.” So, I’m pretty much done fighting with people. Instead, when I find myself in situations like my son-in-law experienced, I say two simple words . . . “I’m sorry.” It doesn’t matter if I’m 100% right, I say “I’m sorry.” At that point the other person doesn’t know what to say. They realize that anything more is pointless, and the situation is quickly defused. I can’t say that I am able to react this way every time, but it’s more often than not.

We have an opportunity to become more modest and unpretentious as we achieve more success in our lives. And with it comes eliminating the propensity to have the last word in confrontational situations.

This blog is being written in tandem with my book, “An Entrepreneur’s Words to Live By,” available on Amazon.com in paperback and Kindle (My Book), as well as being available in all of the other major eBook formats.

The Transparent Entrepreneur

There’s a priceless element to an entrepreneur’s success when it comes to his or her customers, employees and investors. This element can be broken. It can be elusive. And it can be very difficult to regain when lost. Of course, I’m talking about “trust.” But this isn’t so much a blog about trust as it is one of the foundational components to building trust. Let’s explore the concept of transparency.

Transparency is a word that is used a lot these days – sometimes it becomes a bit trite as well as overused. Don’t you just love print advertising and television commercials that implore us to “trust” the company peddling the product? My guard goes up when I hear this sort of naked appeal – I probably am much more cynical about companies that resort to this messaging. If we start with the premise that “trust” is the given baseline, why then, is there a need to say, “Trust me?”

If I do a poor job of delivering what I promise to my customers, I’d much rather admit in an open and honest manner that I screwed up. Too many times we see companies stonewall, deny and otherwise obfuscate when the train goes off the track. This results in mistrust rather than accomplishing whatever we had hoped for by not being transparent. The old saying that the cover-up is worse than the crime certainly applies here!

Transparency begins with the basic core value of integrity. Either we have it or we don’t. We use this core value to guide us in the actions we take to fulfill transparency. I know that there are those who will say, “I’d like to be more transparent but in today’s litigious society I can’t say what I really want to say – I’ll be sued if I do!” However, there are ways to be open and honest without creating legal jeopardy.

We must also remember that most people don’t like surprises – at least not the negative kind. This is especially true when we’re working with our team members and investors. A number of years ago we acquired some land and launched a residential subdivision which turned out to be a bad idea. Shortly after we completed the purchase, installed the streets and sold our first three lots, the financial world came to an end (2008 – 2009). Our lot sales came to a screeching halt and remained very anemic for several years thereafter. We had raised substantial investor equity for this project and needless to say, the lack of sales was a difficult thing to report. Nevertheless, we dutifully wrote and sent investor reports every year laying out the facts. There was no sugarcoating, nor did we try to sound overly hopeful. Eventually there was good news to report and we were naturally pleased to do so. I’ve been told by several of our investors that they never lost confidence or trust in us because we were totally transparent throughout the process. It also helped that we explained in detail what we were doing to try and solve the problem.

Transparency means getting in front of the message rather than being behind the curve. Here’s an example. We learned that a major employer was about to close its doors in a market where we had an apartment property. Immediately, we contacted the investor and let him know that this was happening and apprised him of how we thought this closure might impact the property. We also laid out our plan of action for minimizing the negative impact to the investment. He was also an investor in another property in the same market that was handled by one of our competitors. He told us he never heard from the competitor and appreciated the fact that we delivered bad news as soon as we knew it. Our transparent approach built trust and enabled us to do more business with this investor.

Transparency is one of the cornerstones of trust. By operating with integrity, we are never afraid to deliver good news or bad, and share all that is relevant with our customers, team and investors.

This blog is being written in tandem with my book, “An Entrepreneur’s Words to Live By,” available on Amazon.com in paperback and Kindle (My Book), as well as being available in all of the other major eBook formats.

The Adversity-Beating Entrepreneur

An airplane wing gains lift by taking off into the wind. This then causes the airplane to defy gravity and fly . . . an entrepreneurial metaphor if ever there was one. Interestingly, in my pilot days I once experimented with a downwind takeoff (on a very long runway) and could barely get off the ground. I quickly put the plane back on the runway and ended the experiment!

To build a muscle we exercise it regularly adding more weight and repetitions. Members of the military become elite Seals, Green Berets, Delta Force and Rangers by undergoing rigorous training involving obstacles that severely test the physical and psychological strength of a human being. In Kenya, long distance runners often wear no shoes as they traverse inhospitable terrain, toughening the soles of their feet in the process. I think you can probably see the lessons here.

Adversity can be an entrepreneur’s best friend if we allow it to be. If success comes without challenge, it’s easy to become complacent. We’re also robbed of growth opportunities that result from what we learn as we work through various hardships on the road to achievement. No one says we must like adversity. But avoiding it and fighting it does not work. I’ve found that the most constructive approach is to actually embrace it. For me this means relaxing and easing into adversity. It means establishing a positive mindset and expecting that much good will comes from the experience. We’ve all heard the term “silver linings” and used it many times. Often, we look back on what has transpired and almost as a consolation prize we identify the silver linings. Looking for them in advance can give us the lift that we need to fly through the clouds.

In addition to the tangible benefits that come from overcoming adversity in specific situations, there are numerous more global wins that can occur. Think about the last time you had a tough puzzle to solve. Perhaps one of the outcomes was that of heightened creativity and innovation. When faced with the prospects of failure our creative instincts kick in and the results can be amazing. We also find that collaboration and teamwork increases reinforcing the notion that two heads are better than one. While I thrive on making sense of complexity and solving tough problems, I find that doing it with others is more productive and builds a stronger organization.

Suppose a professional basketball team plays a game against the best high school team in the country. There’s no doubt about which team would win. Now, imagine that the same NBA team plays against the reigning world champion NBA team and beats them. Which win do you suppose offers a greater sense of accomplishment? We need to feel like we are doing something really worthwhile which can be difficult when we prevail without any struggle whatsoever.

Adversity helps us to identify weaknesses within our company as well as with our strategy. When we aren’t tested and succeed anyway, we don’t really know what could happen if our feet were held to the fire. Challenges and obstacles also allow us to develop resilience and perseverance – both individually and organizationally. I truly hated those first few months of my career when I was an apartment manager. I was kicked in the teeth, the rear and every other part of my body – I was totally miserable. But something finally clicked, and I figured it out. Quitting wasn’t an option for many reasons – thank goodness! Now I look back and understand how valuable the tough times were in teaching me how to get off the ground and back on the horse.

When we embrace adversity, we can make it work for us like an airplane uses the wind to take off. Then it can become a powerful tool in the entrepreneur’s toolbox.

This blog is being written in tandem with my book, “An Entrepreneur’s Words to Live By,” available on Amazon.com in paperback and Kindle (My Book), as well as being available in all of the other major eBook formats.