davidpoulos.com

Category: Leadership

  • Does More Pay Equal More Value?

    Does More Pay Equal More Value?

    There has been a lot of talk recently regarding and considering CEO compensation, especially in the financial sector, where the numbers compared to the average person’s income are literally astronomical. In my mind, it comes down to contribution.

    Some companies are so well-constructed, that you could put almost anyone in the corner office and they would continue to run things profitably. Some are so inherently dysfunctional, that the most brilliant leader would founder in the effort to right them and run them logically and practically. But the average firm can benefit from strong leadership to set the tone, strategic direction, and operational efficiency that leads to success.

    Typically this is a seasoned individual, with a good education, a strong network of colleagues and contacts, and enough political awareness to work his way into the job. There are some, especially in the tech sector, that don’t seem to fit this mold, but the vast majority of brick and mortar, bread and butter companies have an executive vet at the helm, one who is compensated handsomely for their work. But what do they really contribute on a daily basis?

    Some lead by example, and therefore contribute as a role model and exemplar just by arriving and communicating within the headquarters office or division facility. Some lead through growth strategy implementation, working with M&A attorneys, brokers, bankers and business owners to grow the company through strategic acquisition of other firms, either to help shore up weaknesses within the firm’s core competences or expand into new affiliated or related markets. Some lead through mentoring, employee relations and succession grooming within the ranks, training and educating younger executives to move through the company with the goal of one day paying back that investment by leading the firm to greater profitability.

    Those may seem like intangible approaches or qualities, but they contribute in numerous ways to the success of the company. In the case of some of the more high-profile financial firms, I’m not entirely sure the millions and in some cases billions that the CEO receives in compensation is proportionate to their contributions to the firm. In some cases, reported ad nauseum in the media, the same executives responsible for driving the profitability out of the firm are the ones now reaping even greater rewards, while the stock holders and general public flounder trying to make ends meet.

    There has been a theory advanced that the CEO shouldn’t receive more than ten times what the lowest paid worker receives. For manufacturing companies that outsource production work to third-world countries, that compensation could be very low indeed. While the mechanics of the theory need some fine tuning, the sentiment is borne out of an innate sense of fairness, an internal gauge of “rightness” and correctness that we all possess when assessing such things. If you still go to the same office I do every day, do basically the same work, maybe among a more wealthy group of people, do you really deserve 100 times more than I do in compensation for it? – not likely.

    Someone ought to do a correlative study cross-referencing the national journalists list of the top 100 best companies to work for, against the top 100 highest compensated CEOs, and see if there is a correlation between compensation and how the workers rank the company. My guess is the correlation would be rather low, and here’s why. Companies that are “Great” to work for usually provide a wide range of outstanding personal benefits, ranging from free child care to extra days off, to paid education, to personal loans, to flexible hours or work-at-home options to help better balance personal- and work-lives of the employees. Those benefits sometimes have expenses attached to them. Places where the CEO is extremely highly compensated are driven by profitability and sales volume, rather than work-life balance for the rank and file – different motivators, different cultures, different definitions of the word “Company”.

    Let us know what your definition of the word “Company” is from a cultural standpoint and whether yours is a “great” place to work, and how much your CEO is compensated, and we can compile the results and see if our theory holds water. Can’t wait to hear from you . . .

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  • Does Your Latest Campaign Pass the “Sniff Test?”

    Does Your Latest Campaign Pass the “Sniff Test?”

    I’ve been working with business clients to assist them in their marketing efforts for nearly 3 decades, and in that time, there have been very few rules that I haven’t broken, bent or ignored altogether. There is one, however, that no matter what your industry or line of business, needs to be present somewhere in the mix – The Sniff Test.

    Human beings evolved over millions of years, surviving due to an over-sized brain and an ability to use that brain power to adapt his environment to suit his needs. One of those adaptations is a facet of the primitive, limbic portion of the brain that senses danger. Things like the hair on the back of your neck standing up, or a queasy feeling in your gut, or a general uneasiness in the back of your mind that tells you there’s someone in the house or that you’re being watched.

    That’s instinct, it’s your subconscious processing what you see and feel and hear and smell, and putting out a primitive nervous signal that there’s something your conscious brain is missing, because it’s too busy working on what’s coming . . .That instinct was developed to keep you alive.

    That same instinct is useful in business, when reviewing partners, business arrangements, marketing strategy, new product development, and other areas where it’s easy to get caught up in the hype and the hysteria, and execute strategies that do not have a strong foundation in logic and data. That is the instinct I call the “sniff test”, and it’s really a jaded, realistic way of looking at a worst-case scenario by stripping away all the “possibles” and “maybes” in the scenario planning, leaving just the facts.

    Say the marketing manager comes to you with a campaign idea that involves the buyer or customer to follow five or six steps in order to redeem an coupon in a product offer, and when you do the math on the offer, the numbers don’t really offer any advantage to the buyer after all the rebates, savings certificates and all the rest is computed.

    Take a step back, pretend your in the grocery store and have two products side by side, yours and your competitor’s. Now read the offer slowly and carefully, and add weight to your competitor’s product for every step you have to take, in order to get the savings the coupon represents. Now subtract weight for every ten cents’ worth of different in price you offer over your competitor’s product. If you product price doesn’t outweigh all the work needed to get it, the offer doesn’t pass the sniff test.

    Despite how it works on paper, in the real world, it just won’t smell good to the consumer. Even if it’s explicitly spelled out that the savings are significant, it will send up a flag for the consumer if it’s too hard to do – too many places for error to creep in, too much work, too many conditions, it will just feel like you’re trying to put one over on them, and they’ll pick the “safe” option – instinct at work.

    Unconsciously, you use the sniff test every day, to evaluate deals, employee performance, new hires, as a lie detector in presentations or meetings – anywhere you place a value judgement not strictly based in logic. If someone asked you after one of those decisions why you went the way you did, you couldn’t give them a solid, concrete, logical answer, you’ll likely think to yourself “it just doesn’t smell right” – you just implemented the sniff test, and whatever your were evaluating didn’t pass.

    Food for thought for the day – tell me your stories of instances where your business dealings didn’t pass the sniff test, and what was ultimately the real reason it was a good decision to pass on it. Enjoy!

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  • Sharpen Your Skills Before They Rust Away . . .

    Sharpen Your Skills Before They Rust Away . . .

    We all develop skills as we go through life and get older and more experienced. Some of those are of a more temporary or cyclic nature, and some are used daily and are at peak performance. Skills like coping with change, or a sudden occurrence, get used when needed and then left off the menu until they are needed again.

    Some are annual, like “How did I put these lights on this Christmas Tree last year?” And some need to be constantly honed or updated, in particular, computer skills. This is a tough one, and in an increasingly computerized world, those who don’t keep up will certainly be left behind to one degree or another.

    I’m not exempt from this phenomenon, either. Skills I learned about computers 20 or so years ago are long gone as they are obsolete, and certainly those learned 30 years ago are useless (try finding punch cards or teletype tapes today!). Modern computer skills in particular need to be practices and updated almost weekly in order to keep up to speed. Once I mastered the use of a server and printer, then the Internet and E-mail came along.

    Once I got the hang of those to some degree, albeit not mastery by any means, then texting, social media and ads came along, and a whole new set of skills was needed. There’s always something new coming along that needs to be learned and understood, but if you don’t make a conscious effort to find out about new developments, they won’t find you and you’ll get left behind. And nobody likes to be left behind.

    I have a theory that there’s a place in everyone’s life where that curiosity diminishes, and you stop making the effort to learn new skills. That date or age is different from person to person, and I suspect there are plateaus that each of use arrives at and must make a conscious decision to either surmount them and climb to the next level or stand pat on what we have and stay there. This date may be strongly influenced by the level of skill needed to maintain the status quo, and stay within our daily comfort zone. When the technology advances so far that it affects our daily functioning and pushes us out of our comfort zone, we are forced to learn new skills.

    Everyday things like banking, shopping, finding services and vendors to meet our needs, all have changed and computerized to the point where it’s difficult to interact with those businesses without some level of computer savvy. Even reading the daily paper is a very different experience than it was even three years ago. There are now lists of “most read stories on the Internet” and stories have links and the columnists and staff writers open themselves up to rebuttal by publishing an e-mail address – in the old days, you had to write to them care of the paper, and they could decide whether to acknowledge receipt and reply. You could just delete the e-mail, true, but that kind of direct access gives them immediate feedback on their work, and they can sense and even quantify the reaction to their efforts almost instantly compared to the week or so delay of years earlier.

    The moral of the story is that as soon as you lose curiosity, and stop learning new things, you are doomed to lose contact with a segment of our culture, and the more of those you lose, the more isolated and irrelevant you become, in the cultural scheme of things. AS in business, if you’re not moving forward, your dying, piece by piece. Maybe it’s time to return to some previously used skill and update it today – sign up for a class, go to a lecture, read a new publication, find a new book (e-book if you prefer) and keep that curiosity burning . . .

    If you liked this train of thought, or if it derailed yours . . . if you’d like more like this, be sure to pick up a copy of “The Marketing Doctor’s Survival Notes”

     

  • Do Your Clients Know You, or Just What You’ve Reminded Them Of Recently?

    Do Your Clients Know You, or Just What You’ve Reminded Them Of Recently?

    Service businesses are funny things sometimes. Clients tend to pigeonhole your service firm based on what service you first performed for them. They rarely actually read the literature you leave behind, especially if it’s a referral, and they usually don’t go back and search it when another type of job arises, no matter how closely related to the first. So your first impression, your first engagement and your referrals tend to shape your brand for you in the customer’s mind, unless you steer it, expand it and broaden it on an almost continual basis.

    It’s an easy trap to fall into, especially for smaller firms, who may appear more limited than they are. I’m no exception to this unfortunately, although I try and avoid it if I can. I have one customer who only thinks of me in connection with trade show displays, because that was the first part of a multi-faceted strategy we recommended for them when entering into a new vertical market. Not that she doesn’t KNOW we offer a full range of marketing services, from strategic planning out to campaign execution and executive guidance, it’s just that I don’t reside in that part of her brain and I’m not connected to her other needs in a way that immediately comes to mind when they arise – I have to make a concerted effort to “remind” her that we are a full-service firm, so that we get connected in that way.

    How many of your customers or internal clients only think of you when they need or have a question about a very narrow range of elements, the one you did for them last, or first? It’s something you might want to explore, and you can test it pretty easily: Call them up and ask “Do you know that we also offer . . .” and see what the response is. Call under the auspices of keeping in touch, a good thing regardless, but hunt for that specific piece of data during the conversation. You might be surprised by the result.

    It may seem strange, but that’s just how the brain works – humans learned to survive by recognizing and remembering patterns, and noticing anything that breaks the pattern, like sensing movement in the brush created by a prey animal. Once a pattern is established, ala your firm performing a certain service, that pattern is retained and it’s difficult to change that perception.

    Here’s the fix: broaden your marketing efforts. Don’t go against brand, in fact if you’re a multi-service firm, this will strengthen that tenet of your brand. But highlight a different angle, a different aspect or subgroup of your offerings in a series of marketing launches – it’s like baiting a fishing line with different baits at different parts of the line – you increase the odds of catching something from the same pond. Even if you think you only offer one thing, and one of your brand characteristics is that you do one thing and do it the best of anyone, there are still different angles and facets of that “one thing” that you can use to “bait the hook” with. Try it, see if you don’t get the phone ringing with new business from old clients who “Didn’t know you offered that”.

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  • Sometimes you want to go . . . where everybody knows your name

    Sometimes you want to go . . . where everybody knows your name

    Everybody wants to be wanted, or at least recognized. I have a few places where they know me on sight when I walk in the door, but that kind of permanence and stability has been rare, especially since I grew up outside the Nation’s Capitol, where there are very few “natives” and the population is extremely transient. Too, I went to a very large university in Boston, where much of the student population was composed of commuters, so the typical school experience was very different, more focused on studying and less on social life, especially after dark, when a majority of the student body left for their own homes in the suburbs.

    Business relationships are often like that, too: you meet, you greet, you follow up, maybe even work on a project or several, and then drift apart. Relationships like anything else have to be nurtured and tended to in order to survive and thrive. The relationship with your customers is just that way. It takes effort to nurture them and to keep customers aware of you and to keep your business top of mind.

    Marketing can do that for you, but it must be sincere, and it must at least appear as much as possible to be PERSONAL. Your customers are humans, whether it’s B-to-B or consumer market, and they deserve to be treated as such. Good marketing, especially direct mail copy, should appear to be written specifically to YOU. That DOESN’T mean you just use the word “you” a lot in the copy – there’s an art to it, and if you’re not feelin’ the art, have a pro write your copy for you – its worth it.

    Customer service is often as simple as answering a question quickly and accurately. It can go as far as going above and beyond and addressing a long-standing problem and turning that complaining customer into an evangelist.

    I was the recipient of some tremendous customer service last night, at a business networking mixer, at the Intercontinental Hotel here in Baltimore. There is one place where they know me when I walk in the door, and this is it. Before I had gotten through the lobby into the bar proper, the top notch bartender, Elizabeth, had my “usual” beverage prepared for me, ready to go without me asking or even looking in her direction.

    Now in reality, I have only been a guest there about 6 times in the last year, but it’s always for the same event, the same time of day and the same day of the week, and our schedules collided on a regular basis – but she took the time and energy to remember after just a few small interactions who I was, what I looked like (winter and summer mind you, no identifying scarf or coat to help) what I liked to drink, and how I liked to get the evening started.

    Terrific! Kudos to Elizabeth for taking the initiative and providing outstanding service – and kudos to Arpad and the staff at the Intercontinental for realizing that sometimes employees need to be empowered to go above and beyond to REALLY please customers, and for allowing them the latitude to do it. I’m sure preparing a drink before the customer asks isn’t in the InterContinental’s policy book, but Elizabeth knew that I would be pleased and she was right. Thank you.

    Write about your good customer experiences here, be glad to pass them along . . .

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  • Top Talent Will Out – Brand Power Is A Fine Thing

    Top Talent Will Out – Brand Power Is A Fine Thing

    I just received an e-mail promotion for Disney Institute corporate training and executive growth coaching – called “D-Thinking your Organization”. In keeping with the Disney brand of old, it’s professional, well-done, creative and deceptively simple. It shows an image of two executives (presumably) with large cardboard cartons on their head, sort of sparring in the hallway – ostensibly thinking “inside-the-box”.

    Disney execs have long been revered for their creativity and resourcefulness, and more importantly for instilling the company culture in their employees so deeply that it affects the rest of their lives in a very positive way. I’ve seen a couple of them speak and it’s mesmerizing to hear their stories of how their customer-oriented service-excessive culture affects the lives of employees and customers alike. Tremendous stories of how good-will on the part of one person in a very minor role in the company affects a customer in a profound way to the point where they become eternal evangelists for the brand. This is the nirvana all brand managers seek, and they have found it, achieved it, and kept it alive after the loss of the founder many years ago.

    The point is that the e-mail promotion, a medium that many so-called marketing gurus have determined is of limited value for corporate marketing due to saturation of the audience, lack of permanence and a host of other reasons, worked – it reached a potential customer, a qualified prospect (me) and got my attention to the point where I not only read the whole thing, but studied the image, analyzed the copy and the headline, and filed it rather than deleting it. So much for gurus.

    The Disney brand extends to every facet of their business, and promotion is no exception. They always manage to be tasteful, honest, transparent and relevant, while being effective in showing their creativity and expertise, in subtle, understated ways. When they undertake something, it’s done RIGHT. Occasionally that means they’re a little behind the curve in terms of time or adoption of technology, but when they get there, all the bugs are worked out, they maximize the medium’s potential, and put it to best use for their purposes. Kudos.

    If you want to see how effective your brand is, or test it to see if it’s functioning as well as Walt Disney’s, request my recent article, “Brand Assessment Tools You Can Use Today” in the comment box below and I’ll send you a copy if you leave me your e-mail address.

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  • Time Off Is Not A Benefit – It’s A Necessity!

    Time Off Is Not A Benefit – It’s A Necessity!

    With the long holiday break just behind us, and if anything we’re all busier than before the break we took to help us relax, I stopped to ponder the value of doing nothing. Some of my best ideas have occurred when I was doing “nothing”. My mind was obviously active, but the body can be fairly inert and immobile, heart rate low, BP down, etc. What makes most people relax is the lack of stress, both good stress and bad stress. Bad stress is presented when there is a challenge presented for which there is no good solution. Good stress is what drives competition, performance, internal drive in search of praise or approval. Bad stress can do physical damage, good stress can drive new levels of achievement. Relaxation can be as simple as having nothing on the schedule for the next hour that is “required” of us.

    The conscious mind may be seemingly inert or inactive, but the subconscious portion is always churning, turning over the available data, mining the memory for connections, coincidences, angles and opportunities. Sometimes, driving the conscious thought pattern in a different direction can give the subconscious the room and resources to put more energy into solving the problem at hand. Not thinking about it can sometimes mean that you’re thinking harder about it, but in a different way, from a different direction.

    Creative endeavors can benefit from this type of approach as well, not just problem solving behavior. When presented with a new marketing challenge, sometimes it’s best to just absorb and the necessary data and see what shape it takes naturally, rather than force it. I’ve worked with several graphic designers and production creatives, who had a policy of not touching a piece of paper(in those days) or a computer mouse to start the project until three days after the project “began”, the initial assignments had been made and some of the preliminary research had yielded some initial results. This gave them time to let the information “percolate” for a few days, giving their subconscious mind time to study the challenge from a variety of angles. I’ve found the designers who employ this technique to almost universally bring something fresh, appropriate, useful and accurate to the table – often they hit a home run the first time out, rather than through evolution involving outside input.

    Doing nothing for some period gives us time to properly file the input presented during the day, assess it’s validity and value, maybe connect some of the pieces of data in a unique or different way. Many successful professionals swear by meditation for stress control and creative inspiration. Meditating forces you to stop everything else, calm yourself, clear your mind, focus on something amorphous or not relevant to the current challenge – precisely the same attributes as “doing nothing”. Maybe calling it meditation legitimizes doing nothing for workaholics? Whatever you call it, your mind needs time to rest, rejuvenate, recover from the daily assault of input from outside sources. Rest can be your sharpest tool for solving problems.

    Let’s take a few moments out this weekend, and take a few extra hours to “Do nothing”. You might find a few problems solved or that things look a bit more clear when you “come back”.

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  • Boss Got ADD? – It Might Be The Media’s Fault . . .

    Boss Got ADD? – It Might Be The Media’s Fault . . .

    Most people have what they think are busy lives, and most of us try to do as much during a given day as possible, to live up to expectations, either our own or someone else’s. That means we’ve figured out where we can cut a few corners and do more than one thing at once, like drive and hold a conversation on a cell phone. Some folks extend that to an extreme degree, adding feeding the kids, reading the paper, programming the nav, and more while driving, local laws and bans be damned – these folks are dangerous.

    At work, most people I know try to be as efficient with their time as possible, to maximize productivity, keep the powers that be happy, secure their position and keep on track. Some take this to an extreme as well, and the ones who suffer are their direct reports and subordinates. If you’ve ever had a boss that was trying to do too much at once, you know how much it drives employees to distraction, and the higher up the chain the ADD boss is, the more chaos they leave in their wake.

    I know of one boss that has reports clinging to every word, not out of extreme interest, but because he rarely ever finishes a sentence, and the object part of the sentence typically contains the “who” or the “what” of the directive at hand. Without it, no one knows what’s expected of them or who’s been assigned half the time. So they all have to listen to each directive to get the big picture, and then divvy up the work as they see fit since the “real” assignments are incomplete or incomprehensible. Ultimately everything gets done, but the time wasted figuring out what’s needed and who’s to do it is actually making the busy manager redundant. I know, there are lots of coping strategies and work-arounds that would work to curb, change or otherwise eliminate this problem. But the point is, the boss is so conflicted, consumed and otherwise easily distracted by new inputs, whether from other coworkers, colleagues, his boss or others, that he can’t stay on track long enough to function. Most of this comes as a response to a reactive culture. What I mean by that is the company culture is one of very high expectation in terms of level of service, both internal and external, to the point of mandated response times on e-mails and phone calls (ie, you must respond in some form to the sender of an e-mail within 2 hours of it’s origination). This type of thing typically evolves in response to a complaint at some point in the past, that people were not responding quickly enough to get their tasks completed in a timely fashion. The reason for the lack of response was never explored, but a policy was put in place to combat it, nonetheless.

    Under those circumstances, the ADD boss has trained himself to let go of what’s in front of him (ie the meeting in progress), and to return to the inbox, lest he miss something or not respond in a timely fashion. Meanwhile, his staff flounders, the meeting gains no momentum and nothing gets accomplished, yet at review time, the boss can say, “we held a meeting, told everyone what’s happening . . .”

    Sometimes, the ADD behavior is simply a response to media bombardment – the brain’s receptors get inundated with input from phones, e-mail, TV, the radio, music downloads, meeting reminders, other conversations, web pages and all the rest, and rebels by not lighting on any one media, including humans, for long enough to overload – it’s sort of like your computer skipping around from app to app to use the available processing power to best advantage, but slowing the entire machine down in the process. Small bites for limited amount of time, rather than longer, more focused attention to one thing at the expense of everything else. This makes the ADD boss “think” he’s getting things done, but it’s an illusion.

    Write in to tell us about your most rambunctious ADD boss . . .

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  • Economy Down, Scammers Up

    Economy Down, Scammers Up

    Over the last few years I’ve seen quite a bit of questionable e-mail come through my in-box, and most of it goes right back out to the Recycle bin. The pleas from various quarters of the globe to “give me millions in exchange for your help in parking this money in your account for a few months” type, the “I’m the ousted prime minister of a small nation and have gotten out of the country with millions but need your help to get it into the US” type, the I’ve inherited millions from my Irish uncle but need your help to get it into the US” type, and a host of other scams, including so-called “phishing” sites, e-mail that drives you to sites that look like a bank, and they ask you for your account information to “verify” your account – actually a bogus site set up to capture your banking info.

    It all sucks, and plays to our greed. One business I know of got their event registration system gamed and hacked by some folks in Nigeria, who registered for events using a fake card number, and then registered for a refund, which would be paid for with a real check out of the company’s account – small change one at a time, but as a block, it adds up to some real money. That company had to go so far as to set up a special escrow account for all Nigerian registrations, that would be sequestered from the rest of the funds until all the credit cards cleared, and refunds issued only from that account.

    As the economy goes through it’s ups and downs, scams like these seem to proliferate when things are just starting to get a little brighter. They seem to work best when there’s a little glimmer of hope for those who receive them. They play on our “get rich quick” mentality, one that pervades the lower income brackets, where one big score can break you into a new lifestyle very quickly, so if there’s a tiny fraction of a chance of it being legitimate and paying off, folks will take the risk.

    It may seem a little Pollyanna-ish of me, but what if those Nigerians used that insight into the human psyche, their ability to manipulate emotion with words ( in a non-native language, no less) and their skill at finding lists that respond, for good rather than evil? What if those guys applied those skills to some of the languishing products or brands out there dying for a boost in sales, how effective could they be? What if they took the time used to concoct these schemes and set up the infrastructure to run them, and used it to brainstorm a way out of the housing crisis, solve the oil spill problem, or the employment problem?

    America is the land of opportunity, and someone ought to provide these folks an opportunity to put their skills to good use for the good of the country in general. They of course would have to be monitored and supervised very closely, but so do half the employees I’ve ever worked with. Maybe a government marketing and scheming think tank ought to be set up, to harness the brain power currently residing in our prisons. With roughly 5% of our adult male population currently incarcerated, there’s much to be learned and shared behind those walls, and we’re wasting a resource that our nation could be using to advance our position in the world. If those folks are smart enough to figure out a way to game a system the size of the banking system, or the stock market, then problems like renewable energy, low-income housing, tax reform and national debt ought to be a piece of cake.

    Write and tell me your best idea for fixing a problem you’ve recognized that would need government backing to carry out, and I’ll collect them and publish the most likely one’s here for all to see.

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